Question

Midshipmen Company borrows $20.000 from Falcon Company on July 1, 2021. Midshipmen repays the amount borrowed and pays Interest of 12% (1%/month) on June 30, 2022 Required: 1.82 Record the necessary entries in the Journal Entry Worksheet below. 3. Calculate the 2021 year-end adjusted balances of interest Payable and interest Expense (assuming the balance of Interest Payable at the beginning of the year is $0) Complete this question by entering your answers in the tabs below. Required 1 and 2 Required 3 Record the necessary entries in the Journal Entry Worksheet below. If no entry is required for a particular transaction/avent select "No Journal Entry Required in the first account field.) View transaction list Journal entry worksheet 1 2 > Record the borrowing for Midshipmen on July 1, 2021 Date General Journal Debit Credit y 1 2021

Answer 1

1) Credit Date 1-Jul-21 Debit $20,000 General Journal Cash Borrowings from Falcon Company (being borrowings from Falcon Company for Midshipmen recorded) $20,000 31-Dec-21 $1,200 Interest Expense (20,000 * 1% * 6) Interest Payable (being accrued interest expense recorded) $1,200 2) 2 3 Interest Payable Interest Expense 5 5 Ending Balance $0 + $1,200 = $1,200 $1,200