Question

2-b. First, complete the table below to calculate the interest expense at maturity. Use those calculated values to prepare your entry to record payment of the note at maturity

Return to question Sylvestor Systems borrows $99,000 cash on May 15 by signing a 90-day, 4%, $99,000 note. 1. On what date does this note mature? 2-a. Prepare the entry to record issuance of the note. 2-b. First, complete the table below to calculate the interest expense at maturity. Use those calculated values to prepare your entry to record payment of the note at maturity. Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required 2B Required Required 2B Required 2A Interest at General Journal Maturity First, complete the table below to calculate the interest expense at maturity. (Use 360 days a year. Round final answers to the nearest who Interest at Maturity $ Principal Rate (96) Time Total interest 99,000 4% 90/360 660 < Required 2A Required 28 General Journal >

Answer 1

SOLUTION

1. Balance days in May = 16 days

June days = 30 days

July days = 31 days

Balance = 90 days - 16 days - 30 days - 31 days = 13 days

Date of Mature of Note = 13th August

2A.

Date	Accounts titles and Explanation	Debit ($)	Credit ($)
May 15	Cash	99,000
	Notes payable		99,000
	(To record issuance of notes payable)

2B.

Principal	99,000
Rate	4%
Time	90 days
Total Interest (99,000*4%*90/360)	990

Journal entry-

Date	Accounts titles and Explanation	Debit ($)	Credit ($)
August 13	Note Payable	99,000
	Interest Expenses	990
	Cash		99,990
	(To record payment of note at maturity)