On June 8, Alton Co. issued an $60,800, 12%, 120-day note payable to Seller Co. Assume...

On June 8, Alton Co. issued an $60,800, 12%, 120-day note payable to Seller Co. Assume that the fiscal year of Seller Co. ends June 30. Using a 360-day year in your calculations, what is the amount of interest revenue recognized by Seller in the following year? When required, round your answer to the nearest dollar.

$7,296

$1,986

$608

$1,216

Expert Solution

Total Interest revenue = $60,800 * 12% * 120 / 360 = $2,432

The amount of interest revenue recognized by Seller in the following year = $2,432 * 98 / 120 = $1,986

ekkarill92 answered 2 years ago

On June 8, Alton Co. issued an $68,100, 11%, 120-day note payable to Seller Co. Assume...

On June 8, Alton Co. issued an $68,100, 11%, 120-day note payable to Seller Co. Assume that the fiscal year of Seller Co. ends June 30. Using a 360-day year in your calculations, what is the amount of interest revenue recognized by Seller in the following year? When required, round your answer to the nearest dollar. $624 $1,249 $7,491

Apr. 8 Issued a $48,000, 75-day, 8% note payable in payment of an account with Bennett...

Apr. 8 Issued a $48,000, 75-day, 8% note payable in payment of an account with Bennett Company. May 15 Borrowed $360,000, 60-day, 9% note from Lincoln Bank. Jun. 22 Paid Bennett Company the principal and interest due on the April 8 note payable. Jul. 6 Purchased $120,000 of merchandise from Bolton Company; signed a note for 90-day, 10% interest. Jul. 14 Paid the May 15 note due Lincoln Bank. Oct. 2 Borrowed $240,000, 120-day, 12% note from Lincoln Bank. Oct....

Entries for Discounted Note Payable A business issued a 45-day note for $80,000 to a creditor...

Entries for Discounted Note Payable A business issued a 45-day note for $80,000 to a creditor on account. The note was discounted at 5%. Assume a 360-day year. a. Journalize the entry to record the issuance of the note. For a compound transaction, if an amount box does not require an entry, leave it blank. a. Accounts Payable _________ _________ Interest Expense _______ _________ Notes Payable _______ _________ b. Journalize the entry...

Entries for Discounted Note Payable A business issued a 90-day note for $48,000 to a creditor...

Entries for Discounted Note Payable A business issued a 90-day note for $48,000 to a creditor on account. The note was discounted at 6%. Assume a 360-day year. a. Journalize the entry to record the issuance of the note. For a compound transaction, if an amount box does not require an entry, leave it blank. If necessary, round to one decimal place. a. b. Journalize the entry to record the payment of the note at maturity. b.

On January 1, Luther Co. issued a $1,000,000, five-year, 8% installment note payable with payments of...

On January 1, Luther Co. issued a $1,000,000, five-year, 8% installment note payable with payments of $250,456 principal plus interest due on January 1 of each year for the next five years. Required: 1. Prepare the adjusting journal entry at December 31 to accrue interest for the year. Refer to the Chart of Accounts for exact wording of account titles. 2. Show the account(s) and amount(s) and where it(they) will appear on a multi-step income statement prepared on December 31....

I. On September 12, 2010, Mardi Gras Mambo Inc. received a $6,000 8%, 120 day note...

I. On September 12, 2010, Mardi Gras Mambo Inc. received a $6,000 8%, 120 day note on account from Throwin’ Things Corporation a. Is the note a note receivable or a note payable for Mardi Gras Mambo? b Is Mardi Gras Mambo the maker or the payee of the note? c What is the face amount of the note? d What is the total amount of cash that is due at maturity (i.e., what is the maturity value of the...

Problem 1 – Entries for notes payable A business issued a 60-day, 5% note for $85,000...

Problem 1 – Entries for notes payable A business issued a 60-day, 5% note for $85,000 to a creditor on account. Journalize the entries to record (a) the issuance of the note and (b) the payment of the note at maturity, including interest. Problem 2 – Calculate payroll An employee earns $24 per hour and 1.5 times that rate for all hours in excess of 40 hours per week. Assume that the employee worked 44 hours during the week. Assume...

You company borrows $80,000 cash on December 1, by signing a 120 day, 8% note, with...

You company borrows $80,000 cash on December 1, by signing a 120 day, 8% note, with a face value of $80,000. Answer the following questions and record the transactions noted. Record the issuance of the note on December 1. Calculate and record the journal entry for interest required on December 31st. Record the payment of interest and principal at maturity.

B 1 On December 1, Destin Corporation borrowed $10,000 on a 120-day, 8% note. Prepare the...

B 1 On December 1, Destin Corporation borrowed $10,000 on a 120-day, 8% note. Prepare the entries to record the issuance of the note, the accrual of interest at year end, and the payment of the note. B 3 Mary Stine’s regular hourly wage rate is $12, and she receives an hourly rate of $18 for work in excess of 40 hours. During a March pay period, Mary works 47 hours. Mary’s federal income tax withholding is $70, and she...

Shawn Bixby borrowed $21,000 on a 120-day, 12% note. After 70 days, Shawn paid $2,400 on...

Shawn Bixby borrowed $21,000 on a 120-day, 12% note. After 70 days, Shawn paid $2,400 on the note. On day 100, Shawn paid an additional $4,400. Use ordinary interest. a. Determine the total interest use the U.S. Rule. (Do not round intermediate calculations. Round your answer to the nearest cent.) Total interest $ b. Determine the ending balance due use the U.S. Rule. (Do not round intermediate calculations. Round your answer to the nearest cent.) Ending balance due $

Question