Question
In: Accounting
On June 1, Oriole Company Ltd. borrows $42,000 from Acme Bank on a 6-month, $42,000, 8%...
On June 1, Oriole Company Ltd. borrows $42,000 from Acme Bank on a 6-month, $42,000, 8% note. The note matures on December 1.
Prepare the entry on June 1. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)
|
Date |
Account Titles and Explanation |
Debit |
Credit |
| June 1 | |||
eTextbook and Media
List of Accounts
Prepare the adjusting entry on June 30. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)
|
Date |
Account Titles and Explanation |
Debit |
Credit |
| June 30 | |||
eTextbook and Media
List of Accounts
Prepare the entry at maturity (December 1), assuming monthly adjusting entries have been made through November 30. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)
|
Date |
Account Titles and Explanation |
Debit |
Credit |
| Dec. 1 | |||
eTextbook and Media
List of Accounts
What was the total financing cost (interest expense)?
| Total interest expense | $Type your answer here |
Solutions
Expert Solution
repare the entry on June 1. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)
|
Date |
Account Titles and Explanation |
Debit |
Credit |
| June 1 | Cash | 42000 | |
| Notes payable | 42000 |
Prepare the adjusting entry on June 30. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)
|
Date |
Account Titles and Explanation |
Debit |
Credit |
| June 30 | Interest expense (42000*8%*1/12) | 280 | |
| Interest payable | 280 |
Prepare the entry at maturity (December 1), assuming monthly adjusting entries have been made through November 30. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)
|
Date |
Account Titles and Explanation |
Debit |
Credit |
| Dec. 1 | Notes payable | 42000 | |
| Interest payable (280*6) | 1680 | ||
| Cash | 43680 |
What was the total financing cost (interest expense)?
| Total interest expense | $1680 |
ekkarill92 answered 1 year agoRelated Solutions
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