Ask Experts Questions for FREE Help !
Ask
    Flo1231's Avatar
    Flo1231 Posts: 4, Reputation: 1
    New Member
    		  
    #1

    Mar 11, 2013, 05:38 PM
    Accounting help
    On July 1, 2011, Collectors Inc. purchased a delivery truck from LBJ Trucks, costing $81,000. However, due to cash flow problems, Collectors Inc. is currently unable to make the payment. Therefore, in order to ensure LBJ Trucks for the payment, Collectors Inc. signed a one-year note with 6% interest per annum, to be payable at maturity. Collectors Inc.'s year-end is on December 31. Prepare all the necessary journal entries related to the notes payable from the time it is signed to the maturity date.



    July 1 To record the purchase of delivery truck
    Dec 31 To record interest accrued
    Jun 30 To record the payment of note payable

    Thanks a lot.
    pready's Avatar
    pready Posts: 3,197, Reputation: 207
    Ultra Member
    		  
    #2

    Mar 11, 2013, 05:42 PM
    Jul 1 your accounts will be Delivery Truck and Notes Payable.

    Dec 31 your accounts will be Interest Expense and Interest Payable.

    Jun 30 your accounts will be Cash, Interest Expense, Interest Payable, and Notes Payable.
Not your question? Ask your question View similar questions
 

Question Tools Search this Question
Search this Question:

Advanced Search

Add your answer here.


Check out some similar questions!

Questions on financial accounting,cost and management accounting [ 3 Answers ]

I want different sets of questions on financial accounting,cost and management accounting for free. I am a teacher in this area

AP Journal Entires - accrual accounting and cash accounting [ 6 Answers ]

What are the journal entries for accrual accounting and cash accounting for an invoice and a payment?

List five differences between management accounting and cost accounting [ 1 Answers ]

Describe five differences between management accounting and cost accounting

View more questions Search