Following are selected transactions of Danica Company for 2016. Dec. 13 Accepted

Question

Following are selected transactions of Danica Company for 2016. Dec. 13 Accepted a $26,000, 45-day, 9% note dated December 13 in granting Miranda Lee extension on her past-due account receivable. 31 Prepared an adjusting entry to record the accrued interest on the Lee note. Complete the table to calculate the interest amounts at December 31st and use (Do not round your intermediate calculations. Use 360 days a year.) ed value to prepare your jou Book Complete this question by entering your answers in the tabs below. rint Interest Amounts General Journal rences Complete the table to calculate the interest amounts at December 31 Interest ough Recognized MaturityDecember 31 Principal Rate (%) Time Total interest General Journal

Explanation / Answer

Note Value = $                  26,000.00 Interest Rate = 9% Maturity Days                                     45 Days Note Accepted Date = Dec, 13 Total Days pending in Dec = 31 Days - 13 Days = 18 Days   Interest @ 9% of $ 26,000 = $                    2,340.00 For 18 Days interest = $ 2340 X 18 Days / 360 Days = $                        117.00 For 45 Days interest = $ 2340 X 45 Days / 360 Days = $                        292.50 TABLE SHOWS THE INTEREST   Particulars Total Through Maturity Interest Recognized December 31st Principal   $                  26,000.00 $                  26,000.00 Rate   9% 9% Time   45 Days 18 Days Total Interest   $                        292.50 $                        117.00

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