On April 1, Kess Company buys merchandise Inventory by issuing a $275,000 -150-day, 11% note payable.

REQUIREMENTS:

1) What is the amount of interest expense Kess incur in Year 1? ( Use 360 days in calculation)

2) On what date is the note due?

3) Prepare Journal entries to record:

a) Issuance of the note ( the purchase of inventory)

b) Payment of the note at maturity.