Ramsey Cingany iou-an tsoo,000, 4s-day note to hukner Company for merchandse inv

Question

Ramsey Cingany iou-an tsoo,000, 4s-day note to hukner Company for merchandse invertory. Budner ducounts the noto at 7%. Assume a 360-day yea. For a compound transaction, it an amount box does not require an entry, leave it blank a. Journalize Ramsey's entries to record L the issuance of the note. 2. the payment of the note at maturity Notes Payable 00.000 what does the iability always have to be recorded at If you mere the borrower how much would you be leaving Buckner with in proceeds? b. Jourealize Buckher's entries to record t. the receipt of end 5 8 0

Explanation / Answer

Debit Credit

1. Merchandise Inventory 793000

Interest Expense(800000*45/360*7%) 7000

Notes Payable 800000

2. Notes Payable 800000

Cash 800000

3. Notes Receivable 800000

Sales 7000

Interest Revenue 793000

4. Cash 800000

Notes Receivable 800000

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