Question
On January 1, the first day of the fiscal year, Shiller Company borrowed $85,000 by giving a seven-year, 7% installment note to Soros Bank. The
On January 1, the first day of the fiscal year, Shiller Company borrowed $85,000 by giving a seven-year, 7% installment note to Soros Bank. The note requires annual payments of $15,772, with the first payment occurring on the last day of the fiscal year. The first payment consists of interest of $5,950 and principal repayment of $9,822.
Required:
A. | Journalize the entries to record the following transactions. Refer to the Chart of Accounts for exact wording of account titles.
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B. | Explain how the notes payable would be reported on the balance sheet at the end of the first year. |
Journal
a. Journalize the entries to record the selected transactions. Refer to the Chart of Accounts for exact wording of account titles.
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JOURNAL
ACCOUNTING EQUATION
DATE | DESCRIPTION | POST. REF. | DEBIT | CREDIT | ASSETS | LIABILITIES | EQUITY | |
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