Bramble Company borrowed $24,000 on November 1, 2017, by signing a $24,000, 10%,

Question

Bramble Company borrowed $24,000 on November 1, 2017, by signing a $24,000, 10%, 3-month note. Prepare Bramble’s November 1, 2017, entry; the December 31, 2017, annual adjusting entry; and the February 1, 2018, entry. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date

Account Titles and Explanation

Debit

Credit

2/1/18

Date

Account Titles and Explanation

Debit

Credit

11/1/1712/31/172/1/18

11/1/1712/31/172/1/18

2/1/18

Explanation / Answer

SOLUTION

Date Account titles and Explanations Debit ($) Credit ($) Nov.1 2017 Cash 24,000 Notes Payable 24,000 Dec.31 2017 Interest Expense ($24,000 * 10% * 2/12 ) 400 Interest Payable 400 Feb. 1 2018 Notes Payable 24,000 Interest Payable 400 Interest Expense ($24,000 * 10% * 1/12 ) 200 Cash 24,600

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