Question
(4 points) On December 31, 2017, Ivanhoe Company acquired a computer from Plato Corporation by issuing a $574,000 zero-interest-bearing note, payable in full on December
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(4 points) On December 31, 2017, Ivanhoe Company acquired a computer from Plato Corporation by issuing a $574,000 zero-interest-bearing note, payable in full on December 31, 2021. Ivanhoe Companys credit rating permits it to borrow funds from its several lines of credit at 12%. The computer is expected to have a 5-year life and a $76,000 salvage value.
a. Prepare the journal entry for the purchase on December 31, 2017.
| Date | Accounts | DR | CR |
| 12/31/17 | |||
b. Prepare any necessary adjusting entries relative to depreciation (use straight-line) and amortization (use effective-interest method) on December 31, 2018.
| Accounts | DR | CR | |
| Depr. | |||
| Interest | |||
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Management Planning Guide For Information Systems Security Auditing
Authors: National State Auditors Association And The U. S. General Accounting Office
1st Edition
1508456720, 978-1508456728
