Question

Blossom Company borrows $69,600 on July 1 from the bank by signing a $69,600, 10%, 1-year note payable. (al Prepare the journal entry to record the proceeds of the note. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit July 1 Prepare the journal entry to record the accrued interest at December 31, assuming adjusting entries are made only at the end of the year. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Dec. 31

Answer 1

Credit Journal Entries Date Account Title and Explanation 01-Jul Cash Note Payable (To record borrowings) / $ Debit 69,600 $ 69,600 $ 3,480 ($ 69,600 * 10%) / 12 Months * 6 Months 31-Dec Interest Expense Interest Payable (To record accrued interet for 6 months) $ 3,480