Question
Annette Corp. issued a $330,000, three-year, zero-interest-bearing note payable to Agnes Corp. for equipment on April 30, Year 5. Annette would normally pay interest at
Annette Corp. issued a $330,000, three-year, zero-interest-bearing note payable to Agnes Corp. for equipment on April 30, Year 5. Annette would normally pay interest at 6%. Annette has a December 31 year-end and will repay the note with three equal yearly payments of $110,000. Annette Corporation follows IFRS. Instructions Prepare the following journal entries for Annette Corporation: (show all your work)
1. Record the note
2. December 31, Year 5 interest accrual
3. April 30, Year 6 payment
4. December 31, Year 6 interest accrual
5. April 30, Year 7 payment
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