Assuming the customer’s borrowing rate is 5%, prepare all journal entries for 2019 and 2020 under IFRS
Q: On February 1st, 2021, Seen This Before Inc. (STB) accepted a non-interest-bearing note from its…
A: GIVEN On February 1st, 2021, Seen This Before Inc. (STB) accepted a non-interest-bearing note from…
Q: On January 1, 2020, MP's customer issued a 3 year 8% note, PHP 3,000,000 for services billed to be…
A: Carrying amount is also known as carrying value or book value. The carrying amount of a note issued…
Q: On July 1, 2019, Lp Manufacturing Co. issued a five-year note payable with a face amount of P250,000…
A: The current liabilities section would include the maturity payment of $50000 and the interest…
Q: On December 31, 2019, Bart Company purchased a machine in exchange for a noninterest bearing note…
A: Note payable is the amount of loan or debt that is borrowed by the business, on which regular…
Q: On January 1, 2019, Love Co. sold merchandise to Kit Store in exchange for a non-interest bearing…
A: Formula: Interest amount = Bond face value x Interest rate Multiplying bond face value with interest…
Q: On January 1, 2021, Corvallis Carnivals borrows $17,000 to purchase a delivery truck by agreeing to…
A:
Q: The Pita Pit borrowed $191,000 on November 1, 2021, and signed a six-month note bearing interest at…
A: Interest expense at December 31, 2021 = Notes payable x rate of interest x no. of months / 12 months
Q: The Pita Pit borrowed $197,000 on November 1, 2021, and signed a six-month note bearing interest at…
A: Formula: Interest expense = Principal amount x Interest rate x Time period
Q: On September 1, 2021, Middleton Corp. lends cash and accepts a $10,000 note receivable that offers…
A: Interest revenue Middleton Corp. will report during 2022 = Face value of note receivable x rate of…
Q: On December 31, 2019, Bart Company purchased a machine in exchange for a noninterest bearing note…
A: Note: Since you have posted a question with multiple sub-parts, we will solve first three subparts…
Q: On February 1, 2021, Stealth Trucks sold a diesel rig to Kansas Transports for $250,000, receiving a…
A: Journal is a place where accounting transactions are listed in the book keeping system before ledger…
Q: On September 1, 2019, Donna Equipment signed a one-year, 8% interest bearing note payable for…
A: Note means an instrument acknowledging as debt due from one party to another party. Interest bearing…
Q: Assuming Valco Brothers Farm fulfills all the terms of the note, prepare the necessary journal…
A: Under Accrual Basis of accounting business transations are recorded as and when they occur. Here…
Q: On November 1, 2021, New Morning Bakery signed a $194,000, 6%, six-month note payable with the…
A: The amount of cash payable at maturity can be calculated as sum of note face value and interest due
Q: On January 1, 2020, Vaughn Manufacturing borrows $ 3150000 from National Bank at 12% annual…
A: Computation of Cash inflow and outflow On borrowing 315000, Company has to pay interest of (315000 x…
Q: On January 1, 2019, Zoom Bank provided a loan of P4,000,000 to D Company. Under the loan agreement,…
A: An impairment loss is the amount by which the carrying amount of an asset or a cash-generating unit…
Q: Stussy Company manufactures and sells electrical generators. On January 1,2019 the entity sold an…
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Q: On January 1, 2021, Lizelle Company signed a P100,000, 12% note due in three years at a discount…
A: We’ll answer the first question since the exact one wasn’t specified. Please submit a new question…
Q: On July 1, 2021, a company loans one of its employees $27,000 and accepts a eight-month, 8% note…
A:
Q: Solid Bank loaned P5,000,000 to a borrower on January 1, 2018. The terms of the loan require…
A: As per amortized cost method, the financial instrument is measured at fair value which is increased…
Q: On July 1, 2019, Lp Manufacturing Co. issued a five-year note payable with a face amount of P250,000…
A: Interest accrued on December 31, 2019 = Face value of note x rate of interest x no. of months/12 =…
Q: Cucina Corporation signed a new installment note on January 1, 2021, and deposited the proceeds of…
A: The process of recording business transactions in the books of accounts for the first time is…
Q: On September 1, 2019, Carolina Electronics Company has 1,150 Blu-ray players ready for sale. On…
A: Journal entry is a primary entry that records the financial transactions initially.
Q: On October 31, 2021, COVID borrowed $400,000 at 11% interest and pledged $500,000 in accounts…
A: The loan is the amount a business organization borrows from any financial institution or any third…
Q: Dan Dayle started a business by issuing an $83,000 face value note to First State Bank on January 1,…
A: Interest is computed as per the following formula Interest=Principal*rate*term
Q: CPA Bank Co. loaned P4,000,000 to a borrower on January 1, 2018. The terms of the loan require…
A: The carrying value of a loan receivable is the present value of all the expected future receipts…
Q: December 11, 2019, Hooper Inc. made a credit sale to Marshall Company and required Marshall to sign…
A: Journal is the book of original entry in which all the financial transactions of the business are…
Q: Solid Bank loaned P5,000,000 to a borrower on January 1, 2018. The terms of the loan require…
A: Impairment loss is the amount by which the carrying value of asset exceeds its recoverable value.…
Q: The Pita Pit borrowed $197,000 on November 1, 2021, and signed a six-month note bearing interest at…
A: Notes payable is the amount that is being borrowed and will have to be paid to another person.…
Q: On January 1, 2019, Brooks, Inc. borrows $90,000 from a bank and signs a 5% installment note…
A: Amount Borrowed: $90,000 Interest rate : 5% per annum
Q: On September 1, 2021, Daylight Donuts signed a $112,000, 9%, six-month note payable with the amount…
A: Notes payable is considered a negotiable instrument. It is classified under the head of current…
Q: On October 1, 2020, Arden Farm Equipment Company sold a pecan-harvesting machine to Valco Brothers…
A: Journal: Journal is the method of recording monetary business transactions in chronological order.…
Q: On September 1, 2021, Daylight Donuts signed a $110,000, 10%, six-month note payable with the amount…
A: Interest Payable on notes Payable: Interest must be paid on nearly all payable notes. Interest must…
Q: On June 18, 2020, Woods Co. received from one of its customers, Webb Co., a 90 day, 11%, $6,000 note…
A: A journal entry is a form of accounting entry that is used to report a business transaction in a…
Q: On January 1, 2020, Magbaril Company sold equipment with a carrying amount of P800,000 to Macud…
A: On 01.01.2020, Magbaril company sold equipment to Macud company. Carrying value of equipment =…
Q: Prepare all appropriate journal entries including the sale of merchandise.
A: Journal entry: Journal entry is the book of original entry where first transactions are recorded in…
Q: On January 1, 2019, Brooks, Inc. borrows $90,000 from a bank and signs a 5% installment note…
A: Interest accrued on 12/31 = Amount borrowed x rate of interest x year = $90,000 x 5% x 1 years =…
Q: On January 1, 2019, Fulton Inc. enters into a contract with Gibson to deliver goods. Gibson pays…
A: The journal entries for Fulton Inc. are shown as below: Working Notes: Computation of…
Q: Cucina Corporation signed a new installment note on January 1, 2021, and deposited the proceeds of…
A: Working note: Computation of annual installment payments:
Q: Coldwell, Inc. issued a $100,000, 4-year, 10% note at face value to Flint Hills Bank on January 1,…
A:
Q: Early in 2020, Cheyenne Equipment Company sold 500 Rollomatics at $5,400each. During 2020, Cheyenne…
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Q: On September 30, 2021, Coronado Corporation received a three-year, 12%, $1,750,000 bank loan. The…
A: GIVEN On September 30, 2021, CORONADO Corporation received a three-year, 12%, $1,750,000 bank…
Q: Jane's Donut Co. borrowed OMR 50,000 on March 1, 2018, and signed a one-year note bearing interest…
A: Interest: Interest is the amount of interest paid on the issue price of the notes by the issuer at…
Q: On July 1, 2021, ABC Co. borrowed P1,000,000 and issued a one-year note payable. The lender…
A: According to this question, we prepare the journal entries with reference to the given scenarios.…
Q: On January 1, 2021, Nees Manufacturing lends $10,000 to Roberson Supply using a 9% note due in eight…
A: Simple Interest: When at the time of returning the loan to the bank, we have to pay back an amount…
Q: On April 1, 2020, MMM company issues a $105,000, three -month, zero-interest-bearing note to Al-Ahli…
A: A journal entry is done to record the transaction that took place in the books of accounts.
Q: On January 1, 2021, Corvallis Carnivals borrows $30,000 to purchase a delivery truck by agreeing to…
A: Given: To calculate the note payable and the first monthly payment as,
Q: On July 1, 2019, Kay Company sold equipment to Mando Company for P 1,000,000. Kay accepted a 10%…
A: Total interest for the year 2020 = Principal outstanding on December 31, 2019 x interest rate x no.…
Q: On October 1, 2021, Oberley Corporation loans one of its employees $40,000 and accepts a 12-month,…
A: The books of accounts are maintained under the accrual basis of accounting where revenue and…
| On January 1, 2019, a company sells a piece of equipment for a list price of $260,000. It receives $30,000 and accepts a note receivable for the remainder. | ||||||||||||
| The balance due is on December 31, 2021, and the note pays an annual interest of 3% every December 31st. | ||||||||||||
| Required: | ||||||||||||
| Assuming the customer’s borrowing rate is 5%, prepare all |
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- Arvan Patel is a customer of Banks Hardware Store. For Mr. Patels latest purchase on January 1, 2018, Banks Hardware issues a note with a principal amount of $480,000, 13% annual interest rate, and a 24-month maturity date on December 31, 2019. Record the journal entries for Banks Hardware Store for the following transactions. A. Note issuance B. Subsequent interest entry on December 31, 2018 C. Honored note entry at maturity on December 31, 2019.Anderson Air is a customer of Handler Cleaning Operations. For Anderson Airs latest purchase on January 1, 2018, Handler Cleaning Operations issues a note with a principal amount of $1,255,000, 6% annual interest rate, and a 24-month maturity date on December 31, 2019. Record the journal entries for Handler Cleaning Operations for the following transactions. A. Entry for note issuance B. Subsequent interest entry on December 31, 2018 C. Honored note entry at maturity on December 31, 2019Resin Milling issued a $390,500 note on January 1, 2018 to a customer in exchange for merchandise. The merchandise had a cost to Resin Milling of $170,000. The terms of the note are 24-month maturity date on December 31, 2019 at a 5% annual interest rate. The customer does not pay on its account and dishonors the note. Record the journal entries for Resin Milling for the following transactions. A. Initial sale on January 1, 2018 B. Dishonored note entry on January 1, 2020, assuming interest has not been recognized before note maturity
- Spath Company borrows 75,000 by issuing a 4-year, noninterest-bearing note to a customer on January 1, 2019. In addition, Spath agrees to sell inventory to the customer at reduced prices over a 5-year period. Spaths incremental borrowing rate is 12%. The customer agrees to purchase an equal amount of inventory each year over the 5-year period so that a straight-line method of revenue recognition is appropriate. Required: Prepare the journal entries on Spaths books for 2019 and 2020. (Round answers to 2 decimal places.)On January 1, 2019, Northfield Corporation becomes delinquent on a 100,000, 14% note to First National Bank, on which 16,651 of interest has accrued. On January 2, 2019, the bank agrees to restructure the note. It forgives the accrued interest, extends the repayment date to December 31, 2021, and reduces the interest rate to 10%. Required: Prepare a schedule for Northfield to compute the annual interest expense in regard to the preceding note for each year of the restructuring agreement.Rain T-Shirts issued a $440,600 note on January 1, 2018 to a customer, Larry Potts, in exchange for merchandise. The merchandise had a cost to Rain T-Shirts of $220,300. The terms of the note are 24-month maturity date on December 31, 2019 at a 4.5% annual interest rate. Larry Potts does not pay on his account and dishonors the note. Record journal entries for Rain T-Shirts for the following transactions. A. Initial sale on January 1, 2018 B. Dishonored note entry on January 1, 2020, assuming interest has not been recognized before note maturity
- Hamlet Corporation purchases computer equipment at a price of 100,000 on January 1, 2019, paying 40,000 down and agreeing to pay the balance in three 20.000 annual instalments beginning December 31, 2019. It is not possible to value either the equipment or the 60,000 note directly; how-ever, Hamlet's incremental borrowing rate is 12%. Required: 1. Prepare a schedule to compute the interest expense and discount amortization on the note. 2. Prepare all the journal entries for Hamlet to record the issuance of the note, each annual interest expense, and the three annual installment payments.On December 1 of the current year, Jordan Inc. assigns 125,000 of its accounts receivable to McLaughlin Company for cash. McLaughlin Company charges a 750 service fee, advances 85% of Jordans accounts receivable, and charges an annual interest rate of 9% on any outstanding loan balance. Prepare the related journal entries for Jordan.Notes Payable and Effective Interest On November 1,2019, Edwin Inc. borrowed cash and signed a 60,000, 1-year note payable. Required: Compute the following items assuming (a) an interest-bearing note at 12%, (b) a non-interest-bearing note discounted at 12%: cash received effective interest rate interest expense for 2019 Prepare the journal entries for Edwin under each case for 2019 and 2020. Next Level Why is the effective rate higher for the non-interest-bearing note?
- On January 1, 2019, Park Company accepted a 36,000, non-interest-bearing, 3-year note from a major customer in exchange for used equipment. The equipment had originally cost Park 200,000 and had a book value of 20,000 on the date of the sale. At the 12% imputed interest rate for this type of loan, the present value of the note is 25,500 on January 1, 2019. Park uses the effective interest rate. What is the carrying value of the note receivable on Parks December 31, 2019, balance sheet? a. 28,560 b. 29,000 c. 32,500 d. 36,000Mystic Magic issued a $120,250 note on January 1, 2018 to a customer, Amy Arnold, in exchange for merchandise. Terms of the note are 9-month maturity date on October 1, 2018 at a 9.6% annual interest rate. Amy Arnold does not pay on her account and dishonors the note. On November 10, 2018, Mystic Magic decides to sell the dishonored note to a collection agency for 25% of its value. Record the journal entries for Mystic Magic for the following transactions. A. Initial sale on January 1, 2018 B. Dishonored note entry on October 1, 2018 C. Receivable sale on November 10, 2018Non-Interest-Bearing Notes Payable On November 16, 2019, Clear Glass Company borrowed 20,000 from First American Bank by issuing a 90-day, non-interest-bearing note. The bank discounted this note at 12% and remitted the difference to Clear Glass. Required: 1. Prepare the journal entries of Clear Glass to record the preceding information, the related calendar year-end adjusting entry, and payment of the note at maturity. 2. Show how the preceding items Would be reported on the December 31, 2019, balance sheet. 3. Next Level What is Clear Glass Companys effective interest rate?
