Nix Co. entered into the following transactions involving short-term liabilities in 2010 and 2011. 2010 Apr. 22

Question:

Nix Co. entered into the following transactions involving short-term liabilities in 2010 and 2011.
2010
Apr. 22 Purchased $6,000 of merchandise on credit from Wolf Products, terms are 1/10, n/30. Nix uses the perpetual inventory system.
May 23 Replaced the April 22 account payable to Wolf Products with a 60-day, $5,400 note bearing 8% annual interest along with paying $600 in cash.
July 15 Borrowed $8,500 cash from Autumn Bank by signing a 90-day, 8% interest-bearing note with a of $8,500.
___?____ Paid the amount due on the note to Wolf Products at Paid the amount due on the note to Autumn Bank at 6 Borrowed $9,600 cash from City Bank by signing a 90-day, 6% interest-bearing note with a of $9,600.
31 Recorded an adjusting entry for accrued interest on the note to City Bank.
2011
__?_____ Paid the amount due on the note to City Bank at (February of 2011 has 28 days.)
Required
1. Determine the date for each of the three notes described.
2. Determine the interest due at for each of the three notes. (Assume a 360-day year.)
3. Determine the interest expense to be recorded in the adjusting entry at the end of 2010.
4. Determine the interest expense to be recorded in 2011.
5. Prepare journal entries for all the preceding transactions and events for years 2010 and 2011.
Face Value
Face value is a financial term used to describe the nominal or dollar value of a security, as stated by its issuer. For stocks, the face value is the original cost of the stock, as listed on the certificate. For bonds, it is the amount paid to the... Maturity
Maturity is the date on which the life of a transaction or financial instrument ends, after which it must either be renewed, or it will cease to exist. The term is commonly used for deposits, foreign exchange spot, and forward transactions, interest...