On January 1, Year 1 Cleaver Company borrowed $85,000 cash by signing a 7% installment note that is to be repaid with 4 annual year-end payments of $25,094, the first of which is due on December 31, Year 1.(a) Prepare the company's journal entry to record the note's issuance.(b) Prepare the journal entries to record the first installment payment.
What will be an ideal response?
| a) | ? | ? | ? |
| Year 1 | ? | ? | ? |
| Jan. 1 | Cash | 85,000 | ? |
| ? | Notes Payable | ? | 85,000 |
| b) | ? | ? | ? |
| Year 1 | ? | ? | ? |
| Dec. 31 | Notes Payable | 19,144 | ? |
| ? | Interest Expense ($85,000 * 0.07) | 5,950 | ? |
| ? | Cash | ? | 25,094 |
Business
You might also like to view...
The debit side of an account
A) depends on whether the account is an asset, liability or owner's equity B) can be either side of the account depending on how the accountant set up the system C) is the right side of the account D) is the left side of the account
Business
SLAPP lawsuits are designed to silence public protests on controversial issues
Indicate whether the statement is true or false
Business
A family limited partnership resembles a will and contains instructions for managing personal assets.
Answer the following statement true (T) or false (F)
Business
The ______________________________ data shows, in chronological sequence, the details of each cash payment made.
Fill in the blank(s) with the appropriate word(s).
Business