Question

The following transactions occurred during 2021 for the Beehive Honey Corporation: Feb. 1 Barrowed $26,000 from a bank and signed a note. Principal and interest at 12% will be paid on January 31, 2022. Apr. 1 Paid $6,400 to an insurance company for a two-year fire insurance policy. July 17 Purchased supplies casting $4,200 on account. The company records supplies purchased in an asset account. At year-end on December , 2021, coating $1,950 remained on hand Nov. 30, 2022. Required: 1. Record each transaction in general journal form. 2. Prepare any necessary adjusting entries at the year-end on December 31, 2021. No adjusting entries were recorded during the year for any item. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Record each transaction in general Journal form. (If no entry is required for a transaction/event, select "No joumal entry required in the first account field.) View transaction list Journal entry worksheet < > Borrawed $26,000 from a bank and signed a note. Principal and interest at 12% will be paid on January 31, 2022. Note: Enter cebits before credits. Date General Journal Debit Credit Feb 01, 2021 Record entry Clear entry View general Journal

Answer 1

Answer:

1) Journal entry

Date	account and explanation	Debit	Credit
Feb 1	Cash	26000
	Notes payable		26000
	(To record borrow)
Apr 1	Prepaid insurance	6400
	cash		6400
	(To record prepaid insurance)
July 17	Supplies	4200
	Account payable		4200
	(To record supplies purchased)
Nov 1	Notes receivable	6000
	Cash		6000
	(To record money lent)

2) Adjusting entry

Date	account and explanation	Debit	Credit
Dec 31	Interest expense (26000*12%*11/12)	2,860
	Interest payable		2,860
	(To record accrued interest)
Dec 31	Insurance expense	2400
	Prepaid insurance (6400/24*9)		2400
	(To record insurance expense)
Dec 31	Supplies expense (4200-1950)	2250
	Supplies		2250
	(To record supplies expense)
Dec 31	Interest receivable (6000*10%*2/12)	100
	Interest revenue		100
	(To record interest)