Tyrell Co. entered into the following transactions involving
short-term liabilities in 2017 and 2018.
2017
Apr. | 20 | Purchased $38,000 of merchandise on credit from Locust, terms n/30. Tyrell uses the perpetual inventory system. | ||
May | 19 | Replaced the April 20 account payable to Locust with a 90-day, $35,000 note bearing 9% annual interest along with paying $3,000 in cash. | ||
July | 8 | Borrowed $54,000 cash from NBR Bank by signing a 120-day, 10% interest-bearing note with a face value of $54,000. | ||
__?__ | Paid the amount due on the note to Locust at the maturity date. | |||
__?__ | Paid the amount due on the note to NBR Bank at the maturity date. | |||
Nov. | 28 | Borrowed $30,000 cash from Fargo Bank by signing a 60-day, 7% interest-bearing note with a face value of $30,000. | ||
Dec. | 31 | Recorded an adjusting entry for accrued interest on the note to Fargo Bank. |
2018
__?__ | Paid the amount due on the note to Fargo Bank at the maturity date. |
1) | Maturity date | ||||||||
locust | NBR | fargo | |||||||
date of the note | 19-May | 8-Jul | 28-Nov | ||||||
term of note | 90 | 120 | 60 | ||||||
maturity date | 17-Aug | 5-Nov | 27-Jan | ||||||
2) | interest due at maturity | ||||||||
principal | * | Rate | * | time | = | interest | |||
locust | 35,000 | * | 9% | * | 90/360 | = | 788 | ||
NBR | 54,000 | * | 10% | * | 120/360 | = | 1800 | ||
Fargo | 30,000 | * | 7% | * | 60/360 | = | 350 | ||
3) | Amount in adjusting entry | ||||||||
Fargo Bank | |||||||||
principal | * | Rate | * | time | = | interest | |||
interest to be acccrued in 2016 | 30,000 | * | 7% | * | 33/360 | = | 193 | ||
4) | interest expense to be recorded in 2017 | ||||||||
principal | * | Rate | * | time | = | interest | |||
interest to recorded in 2018 | 30,000 | * | 7% | * | 27/360 | = | 158 | ||
Journal entries | |||||||||
Date | Accounting titles & Explanations | Debit | Credit | ||||||
2016 | |||||||||
20-Apr | inventory | 38,000 | |||||||
Accounts payable | 38,000 | ||||||||
19-May | Accounts payable | 38,000 | |||||||
cash | 3,000 | ||||||||
notes payable | 35,000 | ||||||||
8-Jul | Cash | 54,000 | |||||||
notes payable | 54,000 | ||||||||
17-Aug | notes payable | 35,000 | |||||||
interest expense | 788 | ||||||||
cash | 35,788 | ||||||||
5-Nov | notes payable | 54,000 | |||||||
interest expense | 1,800 | ||||||||
cash | 55,800 | ||||||||
28-Nov | Cash | 30,000 | |||||||
notes payable | 30,000 | ||||||||
31-Dec | interest expense | 193 | |||||||
interest payable | 193 | ||||||||
2017 | |||||||||
27-Jan | notes payable | 30,000 | |||||||
interest payable | 193 | ||||||||
interest expense | 158 | ||||||||
cash | 30,350 | ||||||||
Tyrell Co. entered into the following transactions involving short-term liabilities in 2017 and 2018. 2017 Apr....
Tyrell Co. entered into the following transactions involving short-term liabilities in 2017 and 2018. 2017 Apr. 20 Purchased $35,500 of merchandise on credit from Locust, terms n/30. Tyrell uses the perpetual inventory system. May 19 Replaced the April 20 account payable to Locust with a 90-day, $35,000 note bearing 9% annual interest along with paying $500 in cash. July 8 Borrowed $66,000 cash from NBR Bank by signing a 120-day, 10% interest-bearing note with a face value of $66,000. __?__...
Tyrell Co, entered into the following transactions involving short-term liabilities in 2016 and 2017 2016 Apr. 20 Purchased $38.500 of merchandise on credit from Locust, terma n/30. Tyrell uses the perpetual inventory system. Nay 19 Replaced the April 20 account payable to Locust with a 90-day, $35,000 note bearing annual interest along with paying $3,500 in cash. July 8 Borrowed $66,000 cash from NBR Bank by signing a 120-day, 12 interest-bearing note with a face value of $66,000. ___ Paid...
Tyrell Co. entered into the following transactions involving short-term liabilities in 2016 and 2017. 2016 Apr. 20 Purchased $36,000 of merchandise on credit from Locust, terms n/30. Tyrell uses the perpetual inventory system. May 19 Replaced the April 20 account payable to Locust with a 90-day, $35,000 note bearing 9% annual interest along with paying $1,000 in cash. July 8 Borrowed $57,000 cash from NBR Bank by signing a 120-day, 12% interest-bearing note with a face value of $57,000. --...
Tyrell Co. entered into the following transactions involving short-term liabilities in 2016 and 2017. inve 2016 Apr. 20 Purchased $36,000 of merchandise on credit from Locust, terms n/30. Tyrell uses the perpetual inventory system. May 19 Replaced the April 20 account payable to Locust with a 90-day, $35,000 note bearing 9% annual interest along with paying $1,000 in cash. July 8 Borrowed $57,000 cash from NBR Bank by signing a 120-day, 12% interest-bearing note with a face value of $57,000....
Tyrell Co. entered into the following transactions involving short-term liabilities in 2016 and 2017 2016 Apr. 20 Purchased $37,000 of merchandise on credit from Locust, terms n/30. Tyrell uses the perpetual May 19 Replaced the April 20 account payable to Locust with a 90-day, S35.000 note bearing 8% annual July 8 Borrowed $69,000 cash from NBR Bank by signing a 120-day, 10% interest-bearing note with a face inventory system. interest along with paying $2,000 in cash. value of $69, 000....
Tyrell Co. entered into the following transactions involving short-term liabilities in 2016 and 2017. 2016 Apr. 20 Purchased $36,000 of merchandise on credit from Locust, terms n/30. Tyrell uses the perpetual inventory system. May 19 Replaced the April 20 account payable to Locust with a 90-day, $35,000 note bearing 9% annual interest along with paying $1,000 in cash. July 8 Borrowed $57,000 cash from NBR Bank by signing a 120-day, 12% interest-bearing note with a face value of $57,000. Paid...
Tyrell Co. entered into the following transactions involving short-term liabilities in 2016 and 2017 2016 Apr. 20 Purchased $38,500 of merchandise on credit from Locust, terms n/30. Tyrell uses the perpetual inventory system. May 19 Replaced the April 20 account payable to Locust with a 90-day, $35,000 note bearing 8 annual interest along with paying $3,500 in cash. July 8 Borrowed $66,000 cash from NBR Bank by signing a 120-day. 120 interest-bearing note with a face value of $66,000. __?_...
Tyrell Co, entered into the following transactions involving short-term liabilities in 2016 and 2017 2016 Apr. 20 Purchased $38.500 of merchandise on credit from Locust, terns n/30. Tyrell uses the perpetual inventory system. May 19 Replaced the April 20 account payable to Locust with a 90-day, $35,000 note bearing 81 annual interest along with paying $3,500 in cash. July 8 Borrowed $66,000 cash from NSR Bank by signing a 120-day, 128 interest-bearing note with a face value of $66,000. Paid...
Tyrell Co. entered into the following transactions involving short-term liabilities in 2016 and 2017. 2016 Apr. 20 Purchased S40,250 of merchandise on credit from Locust, terms n/30. Tyrell uses the perpetual inventory system. May 19 Replaced the April 20 account payable to Locust with a 90-day, $35,000 note bearing 108 annual interest along with paying $5,250 in cash. July 8 Borroved S80,000 cash from NBR Bank by signing a 120-day, 98 interest-bearing note with a face value of $80,000. Paid the amount due on the...
Che Tyrell Co. entered into the following transactions involving short-term liabilities. Year 1 Apr. 20 Purchased $36,000 of merchandise on credit from Locust, terms n/30. May 19 Replaced the April 20 account payable to Locust with a 90-day, 9% , $ 35 ,000 note payable along with paying $1,e00 in cash. July 8 Borrowed $57,e00 cash from NBR Bank by signing a 120-day, 11%, $57,eee note payable. Paid the amount due on the note to Locust at the maturity date....