Question

C.S. Crane Company had the following transactions involving notes payable. July 1, 2022 Borrows $35,000 from First National Bank by signing a 9-month, 8% note. Borrows $38,000 from Lyon County State Bank by signing a 3-month, 6% note. Nov. 1, 2022 Dec. 31, 2022 Prepares adjusting entries. Feb. 1, 2023 Pays principal and interest to Lyon County State Bank. Pays principal and interest to First National Bank. Apr. 1, 2023 Prepare journal entries for each of the transactions. (Credit account titles are automatically in dented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) Account Titles and Explanation Debit Credit Date (To record accrual of interest from First National Bank) (To record accrual of interest from Lyon County State Bank) Click if you would like to Show Work for this question: Open Show Work

Answer 1

Journal entries

Date	General Journal	Debit	Credit
July 1	Cash	35000
	Notes payable-First national Bank		35000
Nov 1	Cash	38000
	Notes payable-Lyon Country state Bank		38000
Dec 31	Interest expense (35000*8%*6/12)	1400
	Interest payable		1400
	(To record accrued interest)
	Interest expense (38000*6%*2/12)	380
	Interest payable		380
	(To record accrued interest)
Feb 1	Notes payable-Lyon Country state Bank	38000
	Interest payable	380
	Interest expense	190
	Cash		38570
Apr 1	Notes payable-First national Bank	35000
	Interest payable	1400
	Interest expense	700
	Cash		37100