During 2015, Brown Capacitor Corp. did not have any short-term notes outstanding until September 1, 2015 when it entered into a loan agreement with its primary bank. Brown Capacitor Corp. received $600,000 on September 1, 2015 as the proceeds from the loan and issued a nine-month promissory note bearing 7.5% annual interest to the bank. Under the terms of the note, Brown Capacitor Corp. was required to make quarterly interest payments to the bank on December 1, March 1, and June 1 with the notes entire face value due with the third interest payment when the note matured on June 1, 2016.

a. Prepare the general journal entry to record the proceeds from the loan and the issuance of the note on September 1, 2015. Post the entry to the relevant T-account(s) on the following page

b. Prepare the general journal entry to record the interest paid by Brown to its bank on December 1, 2015.

c. Prepare the necessary adjustment for interest on the note at December 31, 2015 in general journal form.

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