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Warner Co. entered into the following transactions involving short-term liabilities in 2016 and 2017. 2016 Apr. 22 Purchased $5.000 of merchandise on credit from Fox-Pro,
Warner Co. entered into the following transactions involving short-term liabilities in 2016 and 2017. 2016 Apr. 22 Purchased $5.000 of merchandise on credit from Fox-Pro, terms n/30. Warner uses the per- May 23 Replaced the April 22 account payable to Fox-Pro with a 60-day, $4,600 note bearing 15% an- July 15 Borrowed $12,000 cash from Spring Bank by signing a 120-day, 10% interest-bearing note petual inventory system. nual interest along with paying $400 in cash with a face value of $12,000 Paid the amount due on the note to Fox-Pro at maturity Paid the amount due on the note to Spring Bank at maturity Borrowed $8,000 cash from City Bank by signing a 45-day, 9% interest-bearing note with a face value of $8,000. Recorded an adjusting entry for accrued interest on the note to City Bank. Dec. 6 31 2017 Paid the amount due on the note to City Bank at maturity Required 1. Determine the maturity date for each of the three notes described. 2. De termine the interest due at maturity for each of the three notes. (Assume a 360-day year.) ermine the interest expense to be recorded in the adjusting entry at the end of 2016. termine the interest expense to be recorded in 2017. repare journal entries for all the preceding transactions and events for years 2016 and 2017. 3. Det 5. P amounts to the nearest whole dollar. Assume no reversing entries are used. Round dollar sems issues bonds dated January 1,2017, hat pay interest semiannually on June 30 and December 1 The bonds have Required e a $90,000 par value and an annual contract rate of 12%, and they mature in five years. par each of the following three separate situation For s, (a) determine the bonds' issue price on January 1, Rir 2017,.and (b) prepare the journal entry to record their issuance. 1. The market rate at the date of issuance is 10%. The market rate at the date of issuance is 12%. The market rate at the date of issuance is 14%
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