Drake Consulting performs systems consulting and also sells accounting software. Drake Consulting believes the company will need to borrow $600,000 in order to expand operations. Drake consults the bank and secures a 4%, six-year note on March 1, 2017. Drake must pay the bank principal in six equal installments plus interest annually on March 1.

Drake Consulting performs systems consulting and also sells accounting software. Drake Requirements Consulting believes the company will need to borrow $600,000 in order to expand operations. 1. Record the $600,000 note payable on March 1,2017. Drake consults the bank and secures a 4%, six-year note on March 1, 2017. Drake must pay the 2. Record the en to accru interest due on the note at December 31, 2017. try e bank principal in six equal installments plus interest annually on March 1 3. Record the entry Drake would make to record the payment to the bank on March 1,2018. Requirement 1. Record the $600,000 note payable on March 1, 2017. (Record debits first, then credits. Select the explanation on the last line of the journal entry table.) Credit Date Accounts and Explanation Debit 600,000 2017 Cash Long-Term Notes Payable 600,000 Mar. 1 Received cash in xchange for a 6-year 4% note. Requirement 2. Record the entry to accrue interest due on the note at December 31, 2017. (Record debits first, then credits. Select the explanation on the last line of the journal entry table.) Accounts and Explanation Debit Credit Date 2017 nterest Expense 20,000 Dec. 31 Interest Payable 20,000 Accrued interest expense at year-end Requirement 3. Record the entry Drake would make to record the payment to the bank on March 1, 2018. (Prep a single compound entry for this transaction. Record debits first, then credits are Select the explanation on the last line of the journal entry table.) Accounts and Explanation Date Debit Credit 2018 Long-Term Notes Payable Mar. 1 nterest Payable Interest Expense Cash Paid annual installment of note and interest