ABC company took a loan $5,000 from the bank on Jan. What is the correct accounting...

ABC company took a loan $5,000 from the bank on Jan. What is the correct accounting treatment?

Select one or more:

a. Credit Notes Payable 5,000 and Debit Cash 5,000.

b. Credit Notes Payable 5,000 and Credit Cash 5,000.

c. Debit Notes Payable 5,000 and Debit Cash 5,000.

d. Debit Cash 5,000 and Credit Notes Payable 5,000.

Expert Solution

Option a is correct i.e Credit Notes Payable 5000 and Debit Cash 5000

Reason:

ABC company took loan which increase the Note payable and recorded with credit. Receiving cash which increase asset and recorded with debit.

ekkarill92 answered 2 years ago

A borrower borrows on a five year loan $5,000 from a bank at 10% and will...

A borrower borrows on a five year loan $5,000 from a bank at 10% and will pay back the loan in ten equal $ payments (semi-annually) at the end of each time period. How much is each equal payment, how much principal and interest is paid back, and how much interest is paid back?

ABC Company has the following projected sales: Month Sales Jan $5,000 Feb $14,000...

ABC Company has the following projected sales: Month Sales Jan $5,000 Feb $14,000 Mar $27,000 Apr $56,000 14% of the sales are collected in the same month. 26% of the sales are collected after one month, 42% of the sales are collected after two months, and the remainder are collected after three month. What is the amount of the April collections? Enter your answer rounded off to two decimal points. Do not enter $ or...

A company currently owes $20,000 to a bank for a loan it took 2 years and...

A company currently owes $20,000 to a bank for a loan it took 2 years and 8 months ago. The interest rate charged on the loan was 5.5% compounded monthly. a. What was the original principal of the loan? b. What was the amount of interest charged on the loan?

Tak took out a loan for $5,000 at 4% interest. To repay the loan he must...

Tak took out a loan for $5,000 at 4% interest. To repay the loan he must make a payment of $672.46 at the end of each year for 9 years. How much of his second payment is interest? The question we are interested in is this: After he has made payments for 3 years, how much will he still owe?

In order to start this coffee business, the Manager took a 300K loan from the bank....

In order to start this coffee business, the Manager took a 300K loan from the bank. He/she will have to pay 10K monthly for three years. a-Calculate the effective interest rate (per year). b-If the coffee business makes a Revenue=19K/month and has an operational cost of 12K/Month, Calculate the PW if the study period is 5 years and the MARR is equal to 1.5% per month. Solve by Hand Please

In order to start a coffee business, the Manager took a 300K loan from the bank....

In order to start a coffee business, the Manager took a 300K loan from the bank. He/she will have to pay 10K monthly for three years. a-Calculate the effective interest rate (per year). b-If the coffee business makes a Revenue=19K/month and has an operational cost of 12K/Month, Calculate the PW if the study period is 5 years and the MARR is equal to 1.5% per month. Solve by spreadsheet.

On January 1, 2020, ABC Company borrowed $200,000 from the bank. The loan is a 10-year...

On January 1, 2020, ABC Company borrowed $200,000 from the bank. The loan is a 10-year note payable that requires semi-annual payments of $24,000 every June 30 and December 31, beginning June 30, 2020. Assume the loan has a 20% interest rate, compounded semi-annually. Calculate the amount of the note payable at December 31, 2020 that would be classified as a long-term liability.

4.5 pts On January 1, 2017, ABC Company borrowed $100,000 from the bank. The loan is...

4.5 pts On January 1, 2017, ABC Company borrowed $100,000 from the bank. The loan is a 10-year note payable that requires semi-annual payments of $12,000 every June 30 and December 31, beginning June 30, 2017. Assume the loan has a 20% interest rate, compounded semi-annually. Calculate the amount of the note payable at December 31, 2017 that would be classified as a current liability.

On January 1, 2017, ABC Company borrowed $100,000 from the bank. The loan is a 10-year...

On January 1, 2017, ABC Company borrowed $100,000 from the bank. The loan is a 10-year note payable that requires semi-annual payments of $12,000 every June 30 and December 31, beginning June 30, 2017. Assume the loan has a 20% interest rate, compounded semi-annually. Calculate the amount of the note payable at December 31, 2017 that would be classified as a current liability.

1(a). Company ABC has the following audited balance sheet amounts (under appropriate accounting rules): Bank Loan...

1(a). Company ABC has the following audited balance sheet amounts (under appropriate accounting rules): Bank Loan (Floating rate = prime rate) = $100,000,000 Bonds (7% coupon, 10 years to maturity) = $2,000,000,000 Class A Common Stock (100,000,000 shares outstanding) = $1,000,000,000 Class B Common Stock (200,000,000 shares outstanding) = $2,000,000,000 If the YTM (yield to maturity) on the bonds is 6%, the stock price for Class A=$50 per share and for Class B = $50 per share, the beta of...

Question