Use the details in the following Promissory Note to complete the requirements be

Question

Use the details in the following Promissory Note to complete the requirements below.

You are interviewing for a position as Assistant Accountant at Yau Company. John Caldwell is conducting the interview and she has asked you to prepare Journal Entries (transactions and accruals) related to the above note.

Other Information

Principal and interest are due at maturity of the note.

Yau Co. prepares their financial statements annually. Their fiscal year end is December 31.

Miami, Florida November 1, 20 Six months AFTER THIS DATE Porter Company PROMISES TO PAY TO SECURITY NATIONAL BANK THE SUM OFS $10.000 WITH INTEREST AT THE RATE OF 12% PER ANNUM. SIGNED TITLE Treasurer

Explanation / Answer

Nov-01 Cash 10000       Notes payable 10000 Dec-31 Interest expense 200 =10000*12%/12*2        Interest payable 200 Apr-30 Interest expense 400 Interest payable 200 Notes payable 10000        Cash 10600

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