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Please help solve this in a table foe General Journal Entry On August 1, 2021, Trico Technologies, an aeronautic electronics company, borrows $21 million cash to expand operations
Please help solve this in a table foe General Journal Entry
On August 1, 2021, Trico Technologies, an aeronautic electronics company, borrows $21 million cash to expand operations. The loan is made by FirstBanc Corp. under a short-term line of credit arrangement. Trico signs a six-month, 9% promissory note. Interest is payable at maturity. Trico's year-end is December 31.
Required:
1.-3. Record the necessary entries in the Journal Entry Worksheet below for Trico Technologies.
Expert Solution
| Journal Entries: | |||
| Date | Account Titles and Explanation | Debit | Credit |
| 01-Aug-21 | Cash | 21000000 | |
| Notes Payable | 21000000 | ||
| (To record issue of note for amount borrowed) | |||
| 31-Dec-21 | Interest Expense ($21000,000 * 9%*5/12) | 787500 | |
| Interest Payable | 787500 | ||
| (To record interest expense accrued) | |||
| 31-Jan-21 | Note Payable | 21000000 | |
| Interest Payable | 787500 | ||
| Interest Expense ($21,000,000 * 9%*1/12) | 157500 | ||
| Cash | 21945000 | ||
| (To record payment of note at maturity) | |||
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