Here's the problem:

Batangas Placement Agency issued a 20% $50,000, 120 days promissory note to Manila Skill Trade Center on October 2,2011 for training their contact workers.

* Give the entry of Batangas Placement Agency on October 2, 2011 and its adjusting entry at the end of 2011.

I don't really know the beginning entry. Help Please.

A promissary note is a debt to be paid at a future date, What has actually happened is a purchase has been made on credit

Please tell me the entries on October 2 and December 31, 2011 which is the cut off period

Quote:

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Originally Posted by littleblackstar

please tell me the entries on october 2 and december 31, 2011 which is the cut off period

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Why don't you show me your attempt and I'll tell you if you are right

Quote:

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Originally Posted by paraclete

why don't you show me your attempt and I'll tell you if you are right

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Here's it:

Oct 2
Dr Interest expense 3333
Cr Interest Payable 3333

Dec 31
Dr Interest Expense 2500
Cr Interest Payable 2500

Am I right. Probably wrong. Haha :) Help me

Quote:

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Originally Posted by littleblackstar

Here's it:

Oct 2
Dr Interest expense 3333
Cr Interest Payable 3333

Dec 31
Dr Interest Expense 2500
Cr Interest Payable 2500

Am I right. Probably wrong. Haha :) Help me

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October 2

Trade Creditors credit 50000
Training debit 50000

Dec 31

Interest expense debit 2465.75
Interest Accrued credit 2465.75

Jan 30

Cash credit 53287.67
Trade creditors debit 50000
Interest expense debit 821.92
Interest accrued debit 2465.75

The promissary note was a 120 day note
October 29 Days
November 30 Days
December 31 Days
The note was payable on 30 January
Interest is calculated on the number of days 90/365*.2*50000

No stars for you