On March 1, fixtures and equipment were purchased for $6,000 with a downpayment

Question

On March 1, fixtures and equipment were purchased for $6,000 with a downpayment of $1,500 and a $4,500 note, payable in one year. Interest of 5% per year was due when the note was repaid. The estimated life of the fixtures and equipment is 9 years with no expected salvage value. [Note: Record the complete entry for the March 1 equipment purchase first, then the March 31 depreciation adjusting entry, and finally the March 31 interest adjusting entry. Also, round all answers to the nearest cent.] Account: Account: Accounts Receivable Account: Prepaid Rent Account: Accounts Payable Account: Wages Payable Account: Paid-in Capital Account: Leave Blank Account: Dollar amount: Dollar amount: Dollar amount: Dollar amount: Dollar amount: Dollar amount: Dollar amount: Dollar amount: Fixtures and Equipment Interest Payable Notes Payable Retained Earnings Submit Answer Tries 0/5

Explanation / Answer

JOURNAL ENTRIES:

DATE ACCOUNT TITLES & EXPLANATIONS DEBIT($) CREDIT($) March 1 Fixtures and equipment 6,000 Cash 1,500 Notes Payable 4,500 March 31 Depreciation expense (6,000 / 9 / 12) 55 Fixtures and equipment 55 March 31 Interest on Notes payable (4,500 * 5% for 1 month) 19 Notes payable 19 *-------------------*------------------------*--------------------*

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