Prepare the journal entries related for the above transactions. 2. Prepare the j

Question

Prepare the journal entries related for the above transactions.

2.

Prepare the journal entries related for the above transactions.

Greener Pastures Corporation borrowed $1,150,000 on November 1, 2012. The note carried a 9 percent interest rate with the principle and interest payable on June 1, 2013. The note issued on November 1. The interest accrual on December 31. Indicate the effects (accounts, amounts, and + for increase, - for decrease) for the above transactions. Prepare the journal entries related for the above transactions.

Explanation / Answer

1.

(a) +Assets +Liabilities N/A SE

(b) -Assets - Liabilities NA SE

2.

(a)

Cash 1,150,000

Notes Payable 1,150,000

(b)

Interest Expense (1,150,000 x .09 x 2/12) 17,250

Cash 17,250

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