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Entries for notes payable

Bennett Enterprises issues a $708,000, 60-day, 6%, 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.

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a. Journalize Bennett Enterprises entries to record:

1. the issuance of the note.
2. the payment of the note at maturity.

1.	CashInterest RevenueInventoryNotes PayableNotes ReceivableInventory	Inventory	Inventory
	CashInterest ExpenseInterest RevenueNotes PayableNotes ReceivableNotes Payable	Notes Payable	Notes Payable
2.	CashInterest PayableInterest RevenueNotes PayableNotes ReceivableNotes Payable	Notes Payable	Notes Payable
	Accounts PayableCashInterest ExpenseInterest RevenueNotes ReceivableCash	Cash	Cash
	CashInterest ExpenseInterest RevenueNotes PayableNotes Receivable	- Select -	- Select -

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If you were the borrower how much would you be leaving Spectrum Industries with in proceeds? What does the liability always have to be recorded at?

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b. Journalize Spectrum Industries entries to record:

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

1.	CashInterest ExpenseInterest RevenueNotes ReceivableSales	- Select -	- Select -
	CashInterest ExpenseInterest ReceivableNotes ReceivableSales	- Select -	- Select -
2.	CashInterest ExpenseInterest RevenueNotes PayableNotes Receivable	- Select -	- Select -
	CashInterest ExpenseInterest ReceivableNotes PayableNotes Receivable	- Select -	- Select -
	Accounts ReceivableCashInterest ExpenseInterest RevenueNotes Payable	- Select -	- Select -