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1. Lyle Corp had supplies on hand at July 1 costing $1,200. They bought addition

ID: 2456002 • Letter: 1

Question

1. Lyle Corp had supplies on hand at July 1 costing $1,200. They bought additional supplies costing $900 on July 13th. At July 31 supplies costing $700 were on hand. Supplies expense for July of _____ would be recorded.

a. $1,200

b. $1,900

c. $2,100

d. $1,400

Use the following information to answer questions 2-3: County Bank agrees to lend the Allen Brick Company $200,000, 6%, 9-month note.

2. The entry made by Allen Brick Company on January 1 to record the proceeds

            and issuance of the note is

a. Cash                                                200,000

    Interest Expense                     9,000

            Notes Payable                                                200,000

            Interest Payable                                      9,000

b. Cash                                                191,000

    Interest Expense                     9,000

            Notes Payable                                                200,000

c. Cash                                                200,000

            Notes Payable                                                200,000

d. Cash                                                200,000

    Interest Expense                     9,000

            Notes Payable                                                209,000

3. What entry will Allen Brick Company make to pay off the note and interest at

      maturity assuming that interest expense has been accrued to September 30?

a. Notes Payable                    200,000

    Interest Expense                     9,000

            Cash                                                    209,000

b. Notes Payable                    200,000

    Interest Payable                      6,000  

    Interest Expense                     3,000

            Cash                                                    209,000

c. Notes Payable                    200,000

    Interest Payable                      9,000  

            Cash                                                    209,000

d. Notes Payable                    209,000

            Cash                                                    209,000

1. Lyle Corp had supplies on hand at July 1 costing $1,200. They bought additional supplies costing $900 on July 13th. At July 31 supplies costing $700 were on hand. Supplies expense for July of _____ would be recorded.

a. $1,200

b. $1,900

c. $2,100

d. $1,400

Use the following information to answer questions 2-3: County Bank agrees to lend the Allen Brick Company $200,000, 6%, 9-month note.

2. The entry made by Allen Brick Company on January 1 to record the proceeds

            and issuance of the note is

a. Cash                                                200,000

    Interest Expense                     9,000

            Notes Payable                                                200,000

            Interest Payable                                      9,000

b. Cash                                                191,000

    Interest Expense                     9,000

            Notes Payable                                                200,000

c. Cash                                                200,000

            Notes Payable                                                200,000

d. Cash                                                200,000

    Interest Expense                     9,000

            Notes Payable                                                209,000

3. What entry will Allen Brick Company make to pay off the note and interest at

      maturity assuming that interest expense has been accrued to September 30?

a. Notes Payable                    200,000

    Interest Expense                     9,000

            Cash                                                    209,000

b. Notes Payable                    200,000

    Interest Payable                      6,000  

    Interest Expense                     3,000

            Cash                                                    209,000

c. Notes Payable                    200,000

    Interest Payable                      9,000  

            Cash                                                    209,000

d. Notes Payable                    209,000

            Cash                                                    209,000

Explanation / Answer

1.$1200+$900-$700 = $1400

Therefore supplies expense to be recorded = $1400 I.e. option D

2.Entry to be made by Allen bricks on Jan 1 is option C I.e.

Cash a/c. Dr. 200000

Notes payable. 200000

3.Entry to pay off note and interest at maturity is option A I.e.

Notes payable a/c Dr. 200000

Interest expense a/c. Dr. 9000

Cash. 209000