Question

с.s. Sunland Company had the following transactions involving notes payable. July 1, 2020 Borrows $50,500 from First National Bank by signing a 9-month, 8% note. Nov. 1, 2020 Borrows $64,000 from Lyon County State Bank by signing a 3-month, 6% note. Dec. 31, 2020 Prepares adjusting entries. Feb. 1, 2021 Pays principal and interest to Lyon County State Bank. Apr. 1, 2021 Pays principal and interest to First National Bank. Prepare journal entries for each of the transactions. (Credit account titles are automatically indented when a entries in the order presented in the problem.) Date Account Titles and Explanation Debit Credit 50500 July 1, 2020 Cash 50500 Notes Payable 64000 Nov. 1, 2020 Cash 64000 Notes Payable 2660 Dec. 31, 2020Interest Expense 2660 Interest Payable (Adjusting entry for First National Bank note.)

Answer 1

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Date Accounts Titles and Explanation Interest Expenses Interest Payable Debit Credit Dec 31, 2020 2020 2,020 Adjusting Entry for First National Bank Note( 50,500*8%*6/12):2020 Date Dec 31, 2020 Accounts Titles and Explanation Interest Expenses Interest Payable Debit Credit 640 640 Adjusting Entry for Lyon State Bank Note( 64000*6%*2/12-640

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