CONot secure | ezto.mheducation.com/hm.tpx 060 points PA8-3 Recording Notes Rece
ID: 2554057 • Letter: C
Question
CONot secure | ezto.mheducation.com/hm.tpx 060 points PA8-3 Recording Notes Recelvable Transactions LO 8-3) CRS Marketing (CSM) recently hired a new marketing director, Jeff Otos, for its downtown Minneapolis office. As part of the arrangement, CSM agreed on February 28, 2015, to advance Jeff $45,000 on a one- year, 8 percent note, with interest to be paid at maturity on February 28, 2016. CSM prepares fnancial statements on June 30 and December 31 Required: the journal entry that CSM will make when the note is established. (If no entry is required for a transactionlevent, select "No Journal Entry Required" in the first account field.) View transaction list Journal entry worksheet Record the receipt of a note on February 28, 2015 for a $45,000 loan to an employee. Note: Enter debits before credits. General Journal Debit Credit Feb 28, 2015 Record entry Clear entry View general journal O Type here to searchExplanation / Answer
Answer
Notes payable
$45000
Interest rate
8%
1 year Interest [45000 x 8%]
$3600
4 Month Interest [1 Mar 2015 to 30 June 2015] [ 3600 x 4/12]
$1200
8 Month Interest [1 July 2015 to Feb 28, 2016 [3600 x 8/12]
$2400
Date
General Journal
Debit
Credit
Feb 28, 2015
Salaries expense [any expense account against which such note is issued can be debited]
$ 45,000.00
Notes payable
$ 45,000.00
(notes issued)
June 30, 2015
Interest expense
$ 1,200.00
Interest payable
$ 1,200.00
(4 month interest adjusted)
Feb 28, 2016
Notes payable
$ 45,000.00
Interest expense
$ 2,400.00
Interest payable
$ 1,200.00
Cash
$ 48,600.00
(notes payable paid)
Notes payable
$45000
Interest rate
8%
1 year Interest [45000 x 8%]
$3600
4 Month Interest [1 Mar 2015 to 30 June 2015] [ 3600 x 4/12]
$1200
8 Month Interest [1 July 2015 to Feb 28, 2016 [3600 x 8/12]
$2400
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