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Marigold Corporation, a publicly-traded company, agreed to loan money to another company. On July 1, 2020, the company received a five-year promissory note with a
Marigold Corporation, a publicly-traded company, agreed to loan money to another company. On July 1, 2020, the company received a five-year promissory note with a face value of $510,000, paying interest at a face rate of 4% on July 1 each year. The note was issued to yield an effective interest rate of 5%. Marigold used the effective interest method of amortization for discounts or premiums, and the companys year-end is September 30.
Prepare the journal entries to record the issue of the note on July 1, 2020, and any required accrual entries at the company's year-end on September 30, 2020. Finally, prepare the journal entry to record the first cash collection received on July 1, 2021 for Marigold Corporation (Round answers to decimal places, eg. 58,971. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter for the amounts.) Date Account Titles and Explanation Debit CStep by Step Solution
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