Kwon Co. borrows $270,000 cash on November 1, 2012, by signing a 120-day, 11% no
ID: 2426322 • Letter: K
Question
Kwon Co. borrows $270,000 cash on November 1, 2012, by signing a 120-day, 11% note with a face value of $270,000.
March 1, 2013.
What is the amount of interest expense in 2012 from this note? (Use 360 days a year. Do not round intermediate calculations and round your final answer to the nearest dollar amount. Omit the "$" sign in your response.)
Prepare journal entries to record issuance of the note at issuance. (Omit the "$" sign in your response.)
What is the amount of interest expense in 2013 from this note? (Use 360 days a year. Do not round intermediate calculations and round your final answer to the nearest dollar amount. Omit the "$" sign in your response.)
Prepare journal entries to record accrual of interest at the end of 2012. (Use 360 days a year. Do not round intermediate calculations and round your final answer to the nearest dollar amount. Omit the "$" sign in your response.)
Prepare journal entries to record payment of the note at maturity. (Use 360 days a year. Do not round intermediate calculations and round your final answer to the nearest dollar amount. Omit the "$" sign in your response.)
1. On what date does this note mature? March 27, 2013. March 28, 2013. March 29, 2013. March 30, 2013.March 1, 2013.
2.What is the amount of interest expense in 2012 from this note? (Use 360 days a year. Do not round intermediate calculations and round your final answer to the nearest dollar amount. Omit the "$" sign in your response.)
4(a)Prepare journal entries to record issuance of the note at issuance. (Omit the "$" sign in your response.)
Date General Journal Debit Credit Nov. 1 3.What is the amount of interest expense in 2013 from this note? (Use 360 days a year. Do not round intermediate calculations and round your final answer to the nearest dollar amount. Omit the "$" sign in your response.)
Interest expense $ 4(b)Prepare journal entries to record accrual of interest at the end of 2012. (Use 360 days a year. Do not round intermediate calculations and round your final answer to the nearest dollar amount. Omit the "$" sign in your response.)
Date General Journal Debit Credit Dec. 31 4(c)Prepare journal entries to record payment of the note at maturity. (Use 360 days a year. Do not round intermediate calculations and round your final answer to the nearest dollar amount. Omit the "$" sign in your response.)
Date General Journal Debit Credit Mar. 1Explanation / Answer
Answer:1. March 1, 2013.
Answer:2.Interest expense=$270000*11%*60days/360 days
=$4950
Answer:3 Interest expense=$270000*11%*60 days/260 days=$4950
Answer:4(a)
Debit 'Cash' $ 270,000
Credit 'Note Payable' $ 270,000
Answer:4(b)
Debit 'Interest Expense' $ 4950
Credit 'Interest Payable' $ 4950
Abswer:4(c)
Debit 'Note Payable' $ 270,000
Debit 'Interest Payable' $ 4950
Debit 'Interest Expense' $ 495
Credit 'Cash' $ 279900
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.