Watson Co. issued a 60-day, 8% note for $18,000, dated April 5, to Laker Company

Question

Watson Co. issued a 60-day, 8% note for $18,000, dated April 5, to Laker Company on account. (Assume a 360-day year when calculating interest.) When required, round your answers to the nearest dollar.

a. Determine the due date of the note.

b. Determine the maturity value of the note.
$

c. Journalize the entries to record the following:

Receipt of the note by the payee.

Receipt by the payee of the amount due on the note at maturity.

If an amount box does not require an entry, leave it blank.

1. 2.

Explanation / Answer

SOLUTION

A. Due date is June 4.

B. Maturity Value = Face value + Interest

= $18,000 + ($18,000 * 8% * 60/360)

= $18,000 + $240

= $18,240

C. Journal Entries-

Month Days April 25 May 31 June 4 Total days 60 days

Related Questions

Navigate

• Browse (All)
• Browse W
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.