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25 February, 00:03

A business issued a 120-day, 5% note for $60,000 to a creditor on account. Journalize the entries to record (a) the issuance of the note and (b) the payment of the note at maturity, including interest. Assume a 360-day year. If an amount box does not require an entry, leave it blank. a. b.

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  1. 25 February, 01:10
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    cash 60,000 debit

    note payable 60,000 credit

    --to record issuance--

    interest expense 1,000 debit

    Amortizacion Land 34,000 debi

    ---to reocrd sale of receiptst

    Explanation:

    Interest payment:

    principal x rate x time (being time and rate expressed in protion of a year

    60,000 x 0.05 x 120/360 = 1,000
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