hapter 4 Help Seve & ExitSubmit Check my work Jump Corporation borrowed $60,000

Question

hapter 4 Help Seve & ExitSubmit Check my work Jump Corporation borrowed $60,000 on December 1, year 1 Credit Union. The entire amount of the loan, plus interest, is due February 1, year 2 a. & b Prepare the necessary adjusting entry for interest plus interest on February 1 year 2.(f no entry is required for a transaction/event, select "No journal entry required" in the first account field expense on December 3t year 1 Also, record the repayment of the loan Journal entry worksheet Record the December interest expense 3 5 6 7 8 9 0 E R T Y U I O P D F G HJ K L Enviler

Explanation / Answer

Solution:

Journal Entries - Jump Corporation Date Particulars Debit Credit Dec 31, Year 1 Interest Expense Dr ($60,000*4%*1/12) $200.00            To Interest Payable $200.00 (To record interest expense) Feb 1, Year 2 Notes Payable Dr $60,000.00 Interest Payable Dr $200.00 Interest Expense Dr $200.00            To Cash $60,400.00 (To record payment of note with interest)

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