Question

The following selected transactions relate to liabilities of United Insulation Corporation. United's fiscal year ends on December 31. 2021 Jan. 13 Negotiated a revolving credit agreement with Parish Bank that can be renewed annually upon bank approval. The amount available under the line of credit is $25.e million at the bank's prime rate. 1 Arranged a three-month bank loan of $4.5 million with Parish Bank under the line of credit agreement. Interest at the prime rate of 6% was payable at maturity. 1 Paid the 6% note at maturity. Feb. May Dec. 1 Supported by the credit line, issued $15.3 million of commercial paper on a nine-month note. Interest was discounted at issuance at a 5% discount rate. 31 Recorded any necessary adjusting entry(s). 2022 Sept. 1 Paid the commercial paper at maturity. ces Requited: Prepare the appropriate journal entries through the maturity of each liability. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations. Enter your answers in whole dollars.) View transaction list Journal entry worksheet

Answer 1

Answer
Date	Account titles and Description	Debit ($)	Credit ($)
2021
Jan.31	No Entry Required
Feb. 1	Cash	$   45,00,000
	Notes payable		$         45,00,000
	(To record receipt of loan)
May-01	Notes payable	$   45,00,000
	Interest expense ($4500,000*6%*3/12)	$        67,500
	Cash		$         45,67,500
	(To record payment of note at maturity)
Dec.1	Cash	$1,47,26,250
	Discount on notes payable($15300,000*5%*9/12)	$     5,73,750
	Notes Payable		$      1,53,00,000
	(To record issue of commercial paper)
Dec.31	Interest Expense($15300,000*5%*1/12)	$        63,750
	Discount on Notes payable		$              63,750
	(To record interest accrued)
2022
Sept.1	Interest expense ($15300,000*5%*8/12)	$     5,10,000
	Discount on notes payable		$           5,10,000
	(To record interest accrued)
	Notes payable	$1,53,00,000
	Cash		$      1,53,00,000
	(To record payment of commercial paper at maturity)
Please Like ( Positive Rating )