On June 1, Fancher Company Ltd. borrows $60,000 from First Bank on a 6-month, $60,000, 8% note.

Question:

On June 1, Fancher Company Ltd. borrows $60,000 from First Bank on a 6-month,

$60,000, 8% note. The note matures on December 1.

Instructions

(a) Prepare the entry on June 1.

(b) Prepare the adjusting entry on June 30.

(c) Prepare the entry at maturity (December 1), assuming monthly adjusting entries have been made through November 30.

(d) What was the total financing cost (interest expense)?

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Accounting Tools For Business Decision Making

ISBN: 9781118771112

5th Edition

Authors: Kimmel, Wetlands, Kieso

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On June 1, Fancher Company Ltd. borrows $60,000 from First Bank on a 6-month, $60,000, 8% note.

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Accounting Tools For Business Decision Making

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