This problem continues the Davis Consulting situation from Problem P10-23. Davis Consulting believes the company will need to borrow $ 300,000 in order to expand operations. Davis consults the bank and secures a 10%, five-year note on March 1, 2014. Davis must pay the bank principal in five equal installments plus interest annually on March 1.

Requirements

1. Record the $ 300,000 note payable on March 1, 2014.

2. Record the entry to accrue interest due on the note at December 31, 2014.

3. Record the entry Davis would make to record the payment to the bank on March 1, 2015.