Question
PEI Corp. issues a $250,000, three-month zero-interest-bearing note payable to HSB Bank on May 1, 2020. The note has a present value of $246,385 based
PEI Corp. issues a $250,000, three-month zero-interest-bearing note payable to HSB Bank on May 1, 2020. The note has a present value of $246,385 based on the bank's discount rate of 6%.
Instructions
PEI Corp. has a July 31 year-end.Prepare all necessary journal entries to record the transaction regarding this note on the following dates.Show all calculations and round all numbers to the nearest dollar.
May 1, 2020
July 31, 2020
August 31, 2020.
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Financial and Managerial Accounting
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
3rd edition
978-1-119-3916, 1119392132, 1119392136, 9781119391609, 1119391601, 978-1119392132
