On October 1 of year 1, a company borrowed $492,613 for six months with an interest rate of 8%. The company's year end is December 31. The note is fully paid on March 31 of year 2. How much interest expense should be recognized in year 2 when the note is paid? Provide your answer to the nearest whole dollar (i.e., no decimals).
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Interest Expense = Principal x Interest rate x (Remaining number months / Total number of Months)
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- A company collects an honored note with a maturity date of 24 months from establishment, a 10% interest rate, and an initial loan amount of $30,000. Which accounts are used to record collection of the honored note at maturity date? A. Interest Revenue, Interest Expense, Cash B. Interest Receivable, Cash, Notes Receivable C. Interest Revenue, Interest Receivable, Cash, Notes Receivable D. Notes Receivable, Interest Revenue, Cash, Interest ExpenseOn December 1 of the current year, Jordan Inc. assigns 125,000 of its accounts receivable to McLaughlin Company for cash. McLaughlin Company charges a 750 service fee, advances 85% of Jordans accounts receivable, and charges an annual interest rate of 9% on any outstanding loan balance. Prepare the related journal entries for Jordan.Jain Enterprises honors a short-term note payable. Principal on the note is $425,000, with an annual interest rate of 3.5%, due in 6 months. What journal entry is created when Jain honors the note?
- On December 1 of the current year, Jordan Inc. assigns 125,000 of its accounts receivable to McLaughlin Company for cash. McLaughlin Company charges a 750 service fee, advances 85% of Jordans accounts receivable, and charges an annual interest rate of 9% on any outstanding loan balance. Prepare the related journal entries for Jordan. Refer to RE6-10. On December 31, Jordan Inc. received 50,000 on assigned accounts. Prepare Jordans journal entries to record the cash receipt and the payment to McLaughlin.On June 1, Phillips Corporation sold, with recourse, a note receivable from a customer to a bank. The note has a face value of 15,000 and a maturity value (principal plus interest) of 15,400. The discount is calculated to be 385, and the accrued interest income is 100. The recourse liability is estimated to be 1,000. Prepare the journal entry of Phillips to record the sale of the note receivable.A customer was unable to pay the accounts receivable on time in the amount of $34,000. The customer was able to negotiate with the company and transferred the accounts receivable into a note that includes interest, along with an up-front cash payment of $6,000. The note maturity date is 24 months with a 15% annual interest rate. What is the entry to recognize this transfer?
- Lone Star Company received a 90-day, 6% note for $80,000, dated March 12 from a customer on account. (Assume a 360-day year when calculating interest.) a. Determine the due date of the note. b. Determine the maturity value of the note. c. Journalize the entry to record the receipt of the payment of the note at maturity. If an amount box does not require an entry, leave it blank. June 10A business issued a 60-day, 4% note for $21,600 to a creditor on account. The company uses a 360-day year for interest computations. Journalize the entries for (a) the issuance of the note and (b) the payment of the note at maturity, including interest. If an amount box does not require an entry, leave it blank. When required, round your answers to the nearest dollar. a. b. ?A business issued a 90-day, 5% note for $24,000 to a creditor on account. The company uses a 360-day year for interest calculations. Journalize the entries to record (a) the issuance of the note and (b) the payment of the note at maturity, including interest. If an amount box does not require an entry, leave it blank. When required, round your answers to the nearest dollar. a. Accounts Payable Accounts Payable Notes Payable Notes Payable b. - Select - - Select - - Select - - Select - - Select - - Select -
- On December 1, Gilman Corporation borrowed $20,000 on a 90-day, 6% note. Prepare the entries to record the issuance of the note, the accrual of interest at year end, and the payment of the note. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Credit $11Martinez Co. borrowed $69,589 on March 1 of the current year by signing a 60-day, 6%, interest-bearing note. Assuming a 360-day year, when the note is paid on April 30, the entry to record the payment should include a a.debit to Interest Payable for $696. b.debit to Interest Expense for $696. c.credit to Cash for $69,589. d.credit to Cash for $73,764.A business issued a 120-day, 6% note for $9,000 to a creditor on account. The company uses a 360-day year for interest calculations. Journalize the entries to record (a) the issuance of the note and (b) the payment of the note at maturity, including interest. If an amount box does not require an entry, leave it blank. When required, round your answers to the nearest dollar. a. b.