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Entries for notes payable Instructions Chart of Accounts-Bennett Ent
Entries for notes payable Instructions Chart of Accounts-Bennett Ent. Chart of Accounts-Spectrum Ind. Journal-Bennett Ent. Journal-Spectrum in Instructions Bennett Enterprises issues a $625,000, 90-day, 4% note to Spectrum Industries for merchandise inventory Required: A Journaize Bennett Enterprises entries to record (refer to the company's Chart of Accounts for exact wording of account belea 1. the issuance of the note 2 the payment of the note af maturity Assume a 360-day year B. Journalize Spectrum Industries' entries to record (refer to the company's Chart of Accounts for exact wording of account titles). 1. the receipt of the note 2 the receipt of the payment of the noto at maturity Assume a 360-day year
actions Chart of Accounts-Bennett Ent. Chart of Accounts-Spectrum Ind. Journal-Bennett Ent. Journal-Spectrum Ind. ons Enterprises issues a $625,000, 90-day, 4% note to Spectrum Industries for merchandise inventory Journal-Bennett Ent Red Jou 1 A Journalicze Bennett Enterprises entries to record (refer to the company's Chart of Accounts for exact wording of account sted 1. the issuance of the note on January 1 2. the payment of the note at matunity on April 1. Assume a 360 day year and round amounts to the nearest whole dolar 2. Jou 1 2 NE JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST. REF DIT CREDIT ASSETS LABILITIES EQUITY
Berprises issues a $625,000, 90-day, 4% note to Spectrum Industries for merchandise inventory Journal-Bennett Ent Journal-Spectrum Ind B. Journalize Spectrum Industries entries to record (refer to the company's Chart of Accounts for exact wording of account titles 1. the receipt of the note on January 1. 2. the receipt of the payment of the note at maturity on April 1. Assume a 360-day year and round amounts to the nearest whole devlar JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST RIF DEBIT CREDIT ASSETS LIELITIES COUNTY 1
dolinvokeretakeAssignmentSessionLocatore progress false eBook Calculator Print Item Current Portion of Long-Term Debt Connie's Bistro, Inc. reported the following information about its long-term debt in the notes to a recent financial statement (in milions): Long-term debt consists of the following: December 31 Current Preceding Year Year Total long-term debt 3677,600 $372,700 Less current portion (196,500) (183,000) Long-term debt $483,100 $189,700 a. How much of the long-term debt was disclosed as a current ability on the current year's December 31 balance sheet 6. How much did the total current liabilities change between the preceding vear and the current year as a result of the current portion of long-term debt? cf Connie Oltro did not have additional long-term debt next year, what would be the total long term debt on December 31 of the upcoming year?
Entries for institution on the first day of the local year. She Company borrowed 169,000 by installment to ask. The del mes 12. the first mente of the focal year. The first payment consists of int36.210 and principale 37,025 Journal the tries to record the following alled the installment not for cash on the first day of the year. If an amount bereira leve ank 2. Paid the first annual payment on the note an amount box does not requirement How would the notes pavable be reported on the balance sheet at the end of the thical var?
Expert Solution
Ans.
| S.No. | Date | Description | Post Ref | Debit | Credit | Asset | Liability | Equity |
| A.1 | Cash | $ 625,000.00 | $ 625,000.00 | |||||
| Notes Payable | $ 625,000.00 | $ 625,000.00 | ||||||
| (To record the issuance of the note) | ||||||||
| A.2 | Notes Payable | $ 625,000.00 | $ (625,000.00) | |||||
| Interest Payable ( $ 625,000 * 4% * 90 /360) | $ 6,250.00 | $ (6,250.00) | ||||||
| Cash | $ 631,250.00 | $ (631,250.00) | ||||||
| (To record the payment of the note at maturity) | ||||||||
| B.1 | Notes Receivable | $ 625,000.00 | $ 625,000.00 | |||||
| Cash | $ 625,000.00 | $ (625,000.00) | ||||||
| (To record the receipt of the note) | ||||||||
| B.2 | Cash | $ 631,250.00 | $ 631,250.00 | |||||
| Notes Receivable | $ 625,000.00 | $ (625,000.00) | ||||||
| Accrued Interest | $ 6,250.00 | $ 6,250.00 | ||||||
| (To record the receipt of the payment of the note at maturity) |
2.
a)
$196,500 is the amount disclosed as the current portion of long-term debt.
b)
The current liabilities increased by $13,500 ($196,500 – $186,000).
c)
$ 677,600 - $ 196,500 = $ 481,100
3.
a.1)
Journal entry at the time of issue of installment note for cash:
| Bank | $ 69,000.00 | |
| Notes Payable | $ 69,000.00 |
a.2)
Journal entry at the time of first annual payment:
| Notes Payable | $ 7,675.00 | |
| Interest Payable | $ 6,210.00 | |
| Bank | $ 13,885.00 |
a.3)
Notes payable to be reported in balance sheet at the end of fiscal year
Notes payable end balance = $69,000 - $7,675 = $61,325
Interest for 2nd year = $61,325 * 9% = $ 5,519.25
Installment amount for 2nd year = $13,885
Principal repayment for 2nd year = $13,885 - $5,519.25 = $8,365.75
Therefore out of $61,325 notes payable, $8,365.75 is payable within 1 year.
So, $ 8,365.75 will be shown in balance sheet as current liabilities and remaining $ 52,959.25 will be shown in balance sheet as long term liability.
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