On January 1, Year 1, Wedekind Company issued a $251,000, five year, 5 installment note to Shannon Bank The note requires annual payments of $57,975, beginning on December 31, Year 1 Required Journalize the entries to record the following transactions Refer to the chart of accounts for the exact wording of the account titles CNOW journals do not use lines for journal explanations Every line on a journal page is used for debit or credit entries CNOW journals will automatically indent a credit entry when a credit amount is entered Year 1 Jan 1 Issued the note for cash at its face amount Dec 31 Paid the annual payment on the note, which consisted of interest of $12,550 and principal of $45,425 Year 4 Dec 31 Paid the annual payment on the note, including $5,390 of interest The remainder of the payment reduced the principal balance on the note CHART OF ACCOUNTS Wedekind Company General Ledger ASSETS 110 Cash 111 Petty Cash 121 Accounts Receivable 122 Allowance for Doubtful Accounts 126 Interest Receivable 127 Notes Receivable 131 Merchandise Inventory 141 Office Supplies 142 Store Supplies 151 Prepaid Insurance 191 Land 192 Store Equipment 193 Accumulated Depreciation Store Equipment 194 Office Equipment 195 Accumulated Depreciation Office Equipment LIABILITIES 210 Accounts Payable 221 Salaries Payable 231 Sales Tax Payable 232 Interest Payable 241 Notes Payable 251 Bonds Payable 252 Discount on Bonds Payable 253 Premium on Bonds Payable EQUITY 311 Common Stock 312 Paid In Capital in Excess of Par Common Stock 315 Treasury Stock 321 Preferred Stock 322 Paid In Capital in Excess of Par Preferred Stock 331 Paid In Capital from Sale of Treasury Stock 340 Retained Earnings 351 Cash Dividends 352 Stock Dividends REVENUE 410 Sales 610 Interest Revenue 611 Gain on Redemption of Bonds Journalize the entries to record the transactions Refer to the chart of accounts for the exact wording of the account titles CNOW journals do not use lines for journal explanations Every line on a journal page is used for debit or credit entries CNOW journals will automatically indent a credit entry when a credit amount is entered PAGE 10 JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST REF DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 2 3 4 5 6 7 8

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On January 1, Year 1, Wedekind Company issued a $251,000, five-year, 5% installment note to Shannon Bank. The note requires annual payments of $57,975, beginning

On January 1, Year 1, Wedekind Company issued a $251,000, five-year, 5% installment note to Shannon Bank. The note requires annual payments of $57,975, beginning on December 31, Year 1.

Required:

Journalize the entries to record the following transactions. Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered.

Year 1
Jan.	1	Issued the note for cash at its face amount.
Dec.	31	Paid the annual payment on the note, which consisted of interest of $12,550 and principal of $45,425.
Year 4
Dec.	31	Paid the annual payment on the note, including $5,390 of interest. The remainder of the payment reduced the principal balance on the note.

CHART OF ACCOUNTS

Wedekind Company

General Ledger

	ASSETS
110	Cash
111	Petty Cash
121	Accounts Receivable
122	Allowance for Doubtful Accounts
126	Interest Receivable
127	Notes Receivable
131	Merchandise Inventory
141	Office Supplies
142	Store Supplies
151	Prepaid Insurance
191	Land
192	Store Equipment
193	Accumulated Depreciation-Store Equipment
194	Office Equipment
195	Accumulated Depreciation-Office Equipment

	LIABILITIES
210	Accounts Payable
221	Salaries Payable
231	Sales Tax Payable
232	Interest Payable
241	Notes Payable
251	Bonds Payable
252	Discount on Bonds Payable
253	Premium on Bonds Payable

	EQUITY
311	Common Stock
312	Paid-In Capital in Excess of Par-Common Stock
315	Treasury Stock
321	Preferred Stock
322	Paid-In Capital in Excess of Par-Preferred Stock
331	Paid-In Capital from Sale of Treasury Stock
340	Retained Earnings
351	Cash Dividends
352	Stock Dividends

	REVENUE
410	Sales
610	Interest Revenue
611	Gain on Redemption of Bonds

Journalize the entries to record the transactions. Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered.

PAGE 10

JOURNAL

ACCOUNTING EQUATION