Question

Instructions Valley Designs issued a 120-day, 7% note for $65,400, dated April 15 to Bork Fumiture Company on account. Required: A. Determine the due date of the note. B. Determine the matunity value of the note. Assume a 360-day year. Round your answer to the nearest dolar. C. Journalize the entries to record the following: (1) receipt of the note by Bork Furniture and (2) receipt of payment of the note at maturity. Refer to the Chart of Accounts for exact wording of account titles. Round your answer to the nearest dollar. First Questions A. Determine the due date of the note. B. Determine the matunity value of the note. Assume a 360-day year. Round your answer to the nearest dolar. Journal C. (1) Journalize the entry to record the receipt of the note by Bork Furniture. Refer to the Chart of Accounts for exact wording of account titles. Round your answer to the nearest dollar JOURNAL PAGE 1 ACCOUNTING EQUATION ASSETS LIABILITIESQUITY DATE DESCRIPTION POEST DEBIT CREDIT C. (2) Joumalize the entry to record the receipt of payment of the note at maturity. Refer to the Chart of Accounts for exact wording of account titles. Round your answer to the nearest dollar JOURNAL DESCRIPTION PAGE 1 ACCOUNTING EQUATION ASSETS LIABILITIESQUITY DATE POST DEBIT CREDIT

Answer 1

A.

Due date of the note = 13th AUGUST (15+31+30+31+13 days)

B.

Maturity value = 65,400 + (65,400x7%x120/360) Maturity value = 65,400 +1,526 Maturity value = 66,926

C.

JOURNAL Date Description Post. Ref. Debit 1 Apr. 15 Accounts payable 65,400 Notes payable L ACCOUNTING EQUATION Credit Assets Liabilities Equity Decreases 65,400 Increases JOURNAL Date Description Post. Ref. Debit 1 Aug. 13 Notes payable 65,400 Interest expense 1,526 Cash ACCOUNTING EQUATION Credit Assets Liabilities Equity Decreases Decreases 66,926 Decreases