For general journal entry name: Accounts payable Accrued payroll payable Bonus p

Question

For general journal entry name: Accounts payable Accrued payroll payable Bonus payable Cost of goods sold Cash Deferred income tax liability Earned services revenue Earned ticket revenue Employee bonus expense Employee fed inc.taxes payable Employee life insurance payable Employee medical insurance payable Employee union dues payable Estimated warranty liability Federal unemployment taxes payable FICA-Medicare taxes payable FICA-Medicare Social sec.taxes payable Income taxes expense Income taxes payable Interest expense Interest payable Merchandise inventory Notes payable Office salaries expense Payroll taxes expense Repair parts inventory Salaries payable Sales Sales salaries expense Sales taxes payable State unemployment taxes payable Unearned ticket revenue Unearned service revenue Vacation benefits expense Vacation benefits payable Wages expense Warranty expense Accounts payable Accrued payroll payable Bonus payable Cost of goods sold Cash Deferred income tax liability Earned services revenue Earned ticket revenue Employee bonus expense Employee fed inc.taxes payable Employee life insurance payable Employee medical insurance payable Employee union dues payable Estimated warranty liability Federal unemployment taxes payable FICA-Medicare taxes payable FICA-Medicare Social sec.taxes payable Income taxes expense Income taxes payable Interest expense Interest payable Merchandise inventory Notes payable Office salaries expense Payroll taxes expense Repair parts inventory Salaries payable Sales Sales salaries expense Sales taxes payable State unemployment taxes payable Unearned ticket revenue Unearned service revenue Vacation benefits expense Vacation benefits payable Wages expense Warranty expense Keesha Co borrows $125,000 cash on November 1, 2016, by signing a 120-day, 11% note with a face value of $125,000. 1. On what date does this note mature? (Assume a 365 day year) OMarch 27, 2017 O March 28, 2017 O March 29,2017 O March 30,2017 O March 01,2017 2. & 3. What is the amount of interest expense in 2016 and 2017 from this note? (Use 360 days a year. Do not round intermediate calculations.) through maturity Expense 2016 Expense 2017 O Type here to search

Explanation / Answer

Answer 1 Date of maturity of note = date of issue of note + 120 days Date of maturity of note = 1st Nov.2016 + 120 days = 1st March 2017 Answer 2 & 3 The amount of interest expense in 2016 and 2017 Total through maturity Interest expense 2016 Interest expense 2017 Principal $125,000.00 Rate % 11% Time 120 days 60 days 60 days Total Interest $4,583.33 $2,291.67 $2,291.67 Answer 4 Record the issuance of the $125000 note Date General Journal Debit Credit 1st Nov.2016 Cash $125,000.0 Notes Payable $125,000.0 Record the accrual of interest at the end of 2016 Date General Journal Debit Credit 31st Dec.2016 Interest Expense $2,291.7 Interest Payable $2,291.7 Record the payment of note at maturity Date General Journal Debit Credit 1st March 2017 Notes Payable $125,000.0 Interest Expense $2,291.7 Interest Payable $2,291.7 Cash $129,583.3

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