Exercise 10-1 ous. The more as borrowed on une Kelly Jones and Tami Crawford bor

Question

Exercise 10-1 ous. The more as borrowed on une Kelly Jones and Tami Crawford borrowed $19,000 on a 7-month, 6% note from Gem state Bank to open ther business. C's Cor ee 1, 2017, and the note matures January 1, 2018. Prepare the entry to record the receipt of the funds from the loan. (Credit account titles are automatically indented when amount is entered. Do not indent manually-) Date Account Titles and Explanation Debit Credit June 1 SHOW LIST OF ACCOUNTS Prepare the entry to accrue the interest 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 SHOW LIST OF ACCOUNTS

Explanation / Answer

Jun-01 Cash 19000       Notes payable 19000 Jun-30 Interest expense 95 =19000*6%/12         Interest payable 95 Balance in interest payable account = 95*7= 665 Jan-01 Notes payable 19000 Interest payable 665         Cash 19665

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