Ask Question
BusinessBusiness
24 September, 12:13

Sweet, Inc. issued a $140,000, 4-year, 12% note at face value to Flint Hills Bank on January 1, 2017, and received $140,000 cash. The note requires annual interest payments each December 31.

Required:

Prepare Coldwell's journal entry record:

a. the issuance of the note

b. the December 31 interest payment.

+4
Answers (1)
  1. 24 September, 13:15
    0
    The double entry is given below alongwith its explanation

    Explanation:

    On January 1, 2017, the receipt of money by the issuance of the 12% note would be recorded as increase in liability which would be credited and increase in cash receipt is increase in asset which must be debited. The entry to record the issuance of note is as under:

    Dr Cash $140,000

    Cr Loan Note $140,000

    On December 31, 2017, the Payment of interest of 12% on note would be recorded as increase in expense which must be debited and decrease in cash due to payment is decrease in asset and it must be credited. The entry to record the payment of interest is as under:

    Dr Interest Expense $16,800

    Cr Cash Account $16,800
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “Sweet, Inc. issued a $140,000, 4-year, 12% note at face value to Flint Hills Bank on January 1, 2017, and received $140,000 cash. The note ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers
You Might be Interested in
Stephanie is 12 years old and often assists neighbors on weekends by babysitting their children. Calculate the 2018 standard deduction Stephanie will claim under the following independent circumstances (assume that Stephanie's parents will claim her
Answers (1)
Savings should be treated as another type of
Answers (1)
In most states, each country has a family or domestic relations court to handle
Answers (1)
The conversion of preferred stock into common requires that any excess of the par value of the common shares issued over the carrying amount of the preferred being converted should be:
Answers (1)
On January 1, a company issued 7%, 15-year bonds with a face amount of $90 million for $82,218,585 to yield 8%. Interest is paid semiannually. What was interest expense at the effective interest rate on June 30, the first interest date
Answers (1)
New Questions in Business
Hopson company incurred $900,000 of research and development costs in its laboratory to develop a new product. it spent $120,000 in legal fees for a patent granted on january 2, 2017.
Answers (1)
Which of the following products would be used in calculating GDP2
Answers (1)
Late one night, while studying for your anatomy class, you open a box of saltine crackers to do a little snacking. after chewing on a starchy morsel for a few minutes, you begin to notice a sweet taste in your mouth. what accounts for this?
Answers (1)
A customer, age 51, has a 20 year investment time horizon, a moderate risk tolerance, and is looking for investments that provide both income and growth. The best recommendation would be:
Answers (1)
Which of the following is an incorrect step in the process of partnership liquidation? Question 3 options: Paying any liabilities Allocating gains and losses to partners Selling the assets Closing all accounts payable
Answers (2)
Home » Business » Sweet, Inc. issued a $140,000, 4-year, 12% note at face value to Flint Hills Bank on January 1, 2017, and received $140,000 cash. The note requires annual interest payments each December 31. Required: Prepare Coldwell's journal entry record: a.
Sign Up Forgot Password?