At December $31$ of Year $1,$ Portland Corporation had two notes payable outstanding $($notes $1$ and $2).$ At December $31$ of Year $2,$ Portland also had two notes payable outstanding $($notes $3$ and $4).$ These notes are described below.

Date of note Principal Amount Interest Rate Number of Days

December $31,$ Year $1$

Note $1$ November $25,$ Year $1$ $$27,0008\%90$

Note $2$ December $16,$ Year $116,8009\%60$

December $31,$ Year $2$

Note $3$ December $11,$ Year $215,4009\%120$

Note $4$ December $07,$ Year $218,00010\%90$

Required

a$.$ Prepare the adjusting entries for interest at December $31$ of Year $1.$

b$.$ Assume that the adjusting entries were made at December $31$ of Year $1,$ and that no adjusting entries were made during Year $2.$ Prepare the Year $2$ journal entries to record payment of the notes that were outstanding at December $31$ of Year $1.$

c$.$ Prepare the adjusting entries for interest at December $31$ of Year $2.$

Round answers to nearest dollar. Use $360$ days for interest calculations when applicable.

General Journal

Date Description Debit Credit

a$.$

Dec$\mathrm{.}31$ Answer

Answer

$0$

Answer

$0$

Answer

Answer

$0$

Answer

$0$

To record interest on note $1.$

Dec$\mathrm{.}31$ Answer

Answer

$0$

Answer

$0$

Answer

Answer

$0$

Answer

$0$

To accrue interest on note $2.$

b$.$

Feb$\mathrm{.}14$ Notes Payable Answer

$0$

Answer

$0$

Answer

Answer

$0$

Answer

$0$

Interest Expense Answer

$0$

Answer

$0$

Answer

Answer

$0$

Answer

$0$

To record payment of Note $2.$

Feb$\mathrm{.}23$ Notes Payable Answer

$0$

Answer

$0$

Answer

Answer

$0$

Answer

$0$

Interest Expense Answer

$0$

Answer

$0$

Answer

Answer

$0$

Answer

$0$

To record payment of Note $1.$

c$.$

Dec$\mathrm{.}31$ Answer

Answer

$0$

Answer

$0$

Answer

Answer

$0$

Answer

$0$

To record interest on Note $3.$

Dec$\mathrm{.}31$ Answer

Answer

$0$

Answer

$0$

Answer

Answer

$0$

Answer

$0$

To record interest on Note $4.$