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(Accounts and Notes Payable) The following are selected 2014 transactions of Walker Corporation. Sep 1 Purchased inventory from Encino Company on account for $50,000 Astin
(Accounts and Notes Payable) The following are selected 2014 transactions of Walker Corporation. | ||||||
Sep 1 | Purchased inventory from Encino Company on account for | $50,000 | ||||
Astin records purchases gross and uses a periodic inventory system | ||||||
Oct 1 | Issued a | $50,000 | 12-month, | 8% | note to Encino in payment of account. | |
Oct 1 | Borrowed | $50,000 | from the Shore Bank by signing a 12-month, zero-interest- | |||
bearing | $54,000 | note. | ||||
Instructions: | ||||||
(a) Prepare journal entries for the selected transactions above. | ||||||
Sep 1 | Account Title | Amount | ||||
Account Title | Amount | |||||
Oct 1 | Account Title | Amount | ||||
Account Title | Amount | |||||
Oct 1 | Account Title | Amount | ||||
Account Title | Formula | |||||
Account Title | Amount | |||||
(b) Prepare adjusting entries at December 31. | ||||||
Dec 31 | Account Title | Formula | ||||
Account Title | Formula | |||||
Dec 31 | Account Title | Formula | ||||
Account Title | Formula | |||||
(c) (1) Compute the total net liability to be reported on the December 31 balance sheet for the interest- bearing note. | ||||||
Account Title | Amount | |||||
Account Title | Amount | |||||
Formula | ||||||
(c) (2) Compute the total net liability to be reported on the December 31 balance sheet for the zero-interest- bearing note. | ||||||
Account Title | Amount | |||||
Account Title | Amount | |||||
Formula |
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