Question 1) On December 1, Destin Corporation borrowed RM50,000 on a 90-day, 6% note. Prepare the entries to record the

Question

Question 1) On December 1, Destin Corporation borrowed RM50,000 on a 90-day, 6% note. Prepare the entries to record the issuance of the note, the accrual of interest at year end, and the payment of the note Question 2 During December 2016, Fashion Valley Publishing sold 2,500 12-month annual magazine subscriptions at a rate of RM30 each. The first issues were mailed in January 2013. Prepare the entries on Fashion Valley's books to record the sale of the subscriptions and the mailing of the first issues. Question 3 Landen Company had cash sales of RM54,166 (including taxes) for the month of June. Sales are subject to 6% sales tax. Prepare the entry to record the sale.

Help In Homework · Accepted Answer

Answer 1): Date Particulars Debit Credit Dec-01 Cash 50,000 Notes payable 50,000 Dec-31 Interest Expense 250 Interest Payable 250 (50,000*6%*30/360) Mar-01 Interest Expense (50,000*6%*60/360) 500 Interest Payable (50,000*6%*30/360) 250 Notes payable 50,000 Cash 50,750 ? 2) Date Particulars Debit Credit Dec-16 Cash 75,000 Unearned Revenue 75,000 (2,500 * $30 = $75,000) Jan-17 Unearned Revenue 6,250 Subscription Revenue 6,250 (75000 / 12 = 6,250) ? 3) Particulars Debit Credit Cash 54,166 Sales Revenue 51,100 Sales Tax Payable 3,066 ?

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Question 1) On December 1, Destin Corporation borrowed RM50,000 on a 90-day, 6% note

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Archived Solution

Date	Particulars	Debit	Credit
Dec-01	Cash	50,000
	Notes payable		50,000

Dec-31	Interest Expense	250
	Interest Payable		250
	(50,0006%30/360)

Mar-01	Interest Expense (50,0006%60/360)	500
	Interest Payable (50,0006%30/360)	250
	Notes payable	50,000
	Cash		50,750