Answer:
a.
Accounts Payable 89,100
Interest Expense* 900
Notes Payable 90,000
b.
Notes Payable 90,000
Cash 90,000
$90,000 × 8% × 45/360
EX 11-5 Entries for discounted note payable
A business issued a 45-day note for $90,000 to a creditor on account. The note was discounted at 8%. Journalize the entries to record (a) the issuance of the note and (b) the payment of the note at maturity.
Answer:
a.
Accounts Payable 89,100
Interest Expense* 900
Notes Payable 90,000
b.
Notes Payable 90,000
Cash 90,000
$90,000 × 8% × 45/360
Answer:
a.
Accounts Payable 89,100
Interest Expense* 900
Notes Payable 90,000
b.
Notes Payable 90,000
Cash 90,000
$90,000 × 8% × 45/360