Prepare general journal entries to record these transactions of Davies Company. 1989 Jan. 8 Purchased merchandise on

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Prepare general journal entries to record these transactions of Davies Company. 1989 Jan. 8 Purchased merchandise on credit from Grant Company, invoice dated January 7 , terms \(2 / 10, \mathrm{n} / 60, \$ 15,600\).

Feb. 5 Borrowed money at First State Bank by discounting our own \(\$ 25,000\) note payable for 60 days at \(12 \%\). Since the note matures before the end of the year, the discount should be charged to Interest Expense.

Mar. 10 Gave Grant Company \$2,100 cash and a \$13,500, 60 -day, \(12 \%\) note to secure an extension on our account that was due.

Apr. 5 Paid the note discounted at First State Bank on February 5.

May 10 Paid the note given Grant Company on March 10.

Nov. 1 Borrowed money at First State Bank by discounting our own \(\$ 30,000\) note payable for 90 days at \(14 \%\).


Dec. 16 Borrowed money at InterCity Bank by giving a \(\$ 25,000,60\)-day, \(15 \%\) note payable.
31 Made an adjusting entry to record interest on the November 1 note to First State Bank.
31 Made an adjusting entry to record the accrued interest on the December 16 note to InterCity Bank.
1990 Jan. 30 Paid the November 1 note to First State Bank. Also recorded interest expense related to the note.
Feb. 14 Paid the note given InterCity Bank on December 16.

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Financial Accounting

ISBN: 9780256091939

5th Edition

Authors: Kermit D. Larson, Paul B. W. Miller

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