Graves Company borrows $90,000 on July 1 from the bank by signing a $90,000, 7%, 1-year note payable.

Prepare the journal entries to record the proceeds of the note. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

July 1

Prepare the journal entries to record the accrued interest at December 31, assuming adjusting entries are made only at the end of the year. (Round to 0 decimal places, e.g. 62. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Decmber 31