Bennett Enterprises issues a $564,000, 45-day, 8%, note to Spectrum Industries for merchandise inventory.

Assume a 360-day year. if required, round your answers to the nearest dollar. if an amount box does not require an entry, leave it blank.

A). Journalize Bennett Enterprises' entries to record:

1. The issuance of the note.

Account	Debit	Credit
Inventory	$ = ?
Notes payable		$ = ?

2. the payment of the note at maturity.

Account	Debit	Credit
Notes Payable	$ = ?
Interest Expense	$ = ?
Cash		$ = ?

B). Journalize Spectrum Industries' entries to record:

1. the receipt of the note.

  

Account	Debit	Credit
Notes Receivable	$ =
Sales		$ = ?

2. the receipt of the payment of the note at maturity.

  

Account	Debit	Credit
Cash	$ =
Notes Receivable		$ = ?
Interest Revenue		$ = ?

QUESTION TWO

Units-of-activity Depreciation

A truck acquired at a cost of $595,000 has an estimated residual value of $33,900, has an estimated useful life of 62,000 miles, and was driven 4,300 miles during the year. if required, round your answer for the Depreciation rate to two decimal places.

Answer the Following:

1. The Depreciable Cost? $ = ?

2. The Depreciation Rate? $ = ? per mile

3. The units-of-activity depreciation for the year? $ = ?

QUESTION THREE

Depletion

Intra-Spect Mining Co. acquired mineral rights for $97,750,00. The mineral deposit is estimated at 85,000,000 tons. During the current year, 18,700,000 tons were mined and sold.

1. What is the depletion rate? if required, round to two decimal places.

$ = ? per ton

2. What is the amount of depletion expense for the current year.

$ = ?

3. Journalize the adjusting entry on December 31 to recongize the depletion expense.

Date	Account	Debit	Credit
Dec. 31	Depletion Expense	$ = ?
	Accumulated Depletion		$ = ?