Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The following items were selected from among the transactions completed by Aston Martin Inc. during the current year: Apr. 15. Borrowed $225,000 from Audi Company,

image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
The following items were selected from among the transactions completed by Aston Martin Inc. during the current year: Apr. 15. Borrowed $225,000 from Audi Company, issuing a 30-day, 6% note for that amount. May 1. Purchased equipment by issuing a $320,000, 180-day note to Spyder Manufacturing Co., which discounted the note at the rate of 6%. 15. Paid Audi Company the interest due on the note of April 15 and renewed the loan by Issuing a new 60-day, 8% note for $225,000. (Record both the debit and credit to the notes payable account.) July 14. Paid Audi Company the amount due on the note of May 15. Aug. 16. Purchased merchandise on account from Exige Co., $90,000, terms, n/30. Sept. 15. Issued a 45-day, 6% note for $90,000 to Exige Co., on account. Oct. 28, Paid Spyder Manufacturing Co, the amount due on the note of May 1. 30. Paid Exige Co. the amount owed on the note of September 15, Nov. 16. Purchased store equipment from Gallardo Co. for $450,000, paying $50,000 and issuing a series of twenty 9% notes for $20,000 each, coming due at 30-day intervals. Dec. 16. Paid the amount due Gallardo Co, on the first note in the series issued on November 16. 28. Settled a personal injury lawsuit with a customer for $87,500, to be paid in January, Aston Martin Inc. accrued the loss in a litigation claims payable account. Required: For a compound transaction, accounts should be listed largest to smallest. 1. Journalize the transactions. If an amount box does not require an entry, leave it blank. Assume a 360-day year. Check My Work Date Account Credit Debit 225,000 pr. 15 Cash Notes Payable 225,000 May 1 Equipment 310,400 Interest Expense 9,600 Notes Payable 320,000 May 15 Notes Payable 225,000 Interest Expense Notes Payable 225,000 Cash July 14 Notes Payable Interest Expense Cash Aug. 16 Inventory Accounts Payable-Exige Co. Check My Work Homework eBook Show Me How Inventory Accounts Payable-Exige Co. Accounts Payable-Exige Co. Notes Payable Notes Payable Cash Notes Payable Interest Expense Cash Store Equipment Notes Payable Cash Notes Payable Interest Expense Cash hy Work pter 10 Homework eBook Show Me How Dec. 16 Notes Payable Interest Expense Cash Dec. 28 Litigation Loss Litigation Claims Payable 2. Journalize the adjusting entry for each of the following accrued expenses at the end of the a. Product warranty cost, $26,800. b. Interest on the 19 remaining notes owed to Gallardo Co. If an amount box does not require an entry, leave it blank. Item Debit Credit Account Product Warranty Expense a. Product Warranty Payable Interest Expense Interest Payable

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Auditing And Assurance Services

Authors: Louwers, Timothy Louwers

5th Edition

0078025443, 978-0078025440

More Books

Students also viewed these Accounting questions

Question

Formulate strategies and recommendations for action on HRM issues.

Answered: 1 week ago