$1$

Blanton Plastics, a household plastic product manufacturer, borrowed $$8$ million cash on October $1,2024,$ to provide working capital for year$-$end production. Blanton issued a four$-$month, $6\%$ promissory note to L&T Bank under a prearranged short$-$term line of credit Interest on the note was payable at maturity. Each firm's fiscal period is the calendar year.

Required:

Prepare the journal entries to record $($a$)$ the issuance of the note by Blanton Plastics and $($b$)$ L&T Bank's receivable on October $1,2024.$

Prepare the journal entries by both firms to record all subsequent events related to the note through January $31,2025$

the face amount of the note was adjusted to include interest $($a noninterest$-$bearing note$)$ and $6\%$ is the bank's stated discount rate. $($a$)$ Prepare the journal entries to record the issuance of the noninterest$-$bearing note by Blanton Plastics on October $1,2024,$ the adjusting entry at December $31,$ and payment of the note at maturity. $($b$)$ What would be the effective interest rate?

Complete this question by entering your answers in the tabs below.

Req $1,$ Req $2,$ Req $3A,$ Req $3$ B

Prepare the journal entries to record $($a$)$ the issuance of the note by Blanton Plastics and $($b$)$ L&T Bank's receivable on October $1,2024$ Note: If no entry is required for a transaction$/$event$,$ select $"$No journal entry required" in the first account field. Enter your answers in whole dollars.

Journal entry worksheet

Record the issuance of the note by Blanton Plastics.

Prey $1$ of $2$ Next $>$

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