Course: NUT4553-101 MxCh10HW xC Accounting question | Ch x Cezto.mheducation.com
ID: 2400453 • Letter: C
Question
Course: NUT4553-101 MxCh10HW xC Accounting question | Ch x Cezto.mheducation.com/hm.tpx Nicole thinks that her business, Nicole's Getaway Spa (NGS), is doing really well and she is planning a large expansion. With such a large expansion, Nicole will need to finance some of it using debt She signed a one-year note payable with the bank for S45,000 with a 6 percent interest rate. The note was issued October 1, 2014 interest is payable semiannually and the end of Nicole's accounting period is December 31 Required: Prepare the journal entries required from the issuance of the note until its maturity on September 30, 2015 assuming that no entries are made other than at the end of the accounting period, when interest is payable, and when the note reaches its maturity. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Do not round intermediate calculations.) View transaction list Journal entry worksheet Record the borrowing of $45,000 Note: Enter debits before credits. Date General Journal Credit October 01, 2014 Record entry Clear entry View general journal O Type here to search S:54 PM 7/9/2018Explanation / Answer
Journal entry :
Date account & explanation debit creidt Oct 1,2014 Cash 45000 Notes payable 45000 (To record borrowing) Dec 31,2014 Interest expense (45000*6%*3/12) 675 Interest payable 675 (To record accured interest) Mar 31,2015 Interest payable 675 Interest expense 675 Cash 1350 (To record interest paid) Sep 30,2015 Interest expense 1350 Cash 1350 (To record interest paid) Sep 30,2015 Notes payable 45000 Cash 45000 (To record notes repaid)