Recording Notes Payable -Assume Treetop Airlines borrows $300,000 from Bank of A
ID: 2575796 • Letter: R
Question
Recording Notes Payable
-Assume Treetop Airlines borrows $300,000 from Bank of America on September 1, 2018, signing a 8%, six-month note.
September 1, 2018 Debit Credit
---------------------------------------
Recording Interest Payable and Repayment of Notes Payable
•-Year-end adjusting entry for interest payable
December 31, 2018 Debit Credit
-Repayment of note
March 1, 2019 Debit Credit
-------------------------------------------------
Sales Tax Payable
-Assume you buy dinner for $105 plus 10% sales tax. The airport restaurant records the journal entry as shown.
Debit Credit
-----------------------------------
Explanation / Answer
Recording notes payable :
Assume you buy dinner for $105 plus 10% sales tax. The airport restaurant records the journal entry as shown.
date accounts & explanation debit credit 2018, sep 1 Cash a/c 300000 Notes payable a/c 300000 (To record amount borrowed) 2018, dec 31 Interest expenses a/c 8000 Interest payable a/c 8000 (TO record accured interest) 2019, feb 28 Notes payable a/c 300000 Interest payable a/c 8000 Interest expenses a/c 4000 Cash a/c 312000 (To record repayment of notes)Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.