Question

On August 1, 2021, Trico Technologies, an aeronautic electronics company, borrows $20.9 million cash to expand operations. The loan is made by FirstBanc Corp. under a short-term line of credit arrangement. Trico signs a six-month, 6% promissory note. Interest is payable at maturity. Trico's year-end is December 31. Required: 1.-3. Record the necessary entries in the Journal Entry Worksheet below for Trico Technologies. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field. Enter your answers in dollars, not in millions (i.e. 5 should be entered as 5,000,000).) View transaction list Journal entry worksheet 1 2 3 Record the issuance of note. Note: Enter debits before credits. General Journal Debit Credit Date August 01, 2021 Record entry View general journal Clear entry

Answer 1

Aug 1	Cash	20,900,000
	Notes payable		20,900,000
Dec 31	Interest expense	522,500
	Interest payable (20,900,000*5/12*6%)		522,500
Jan 31	Notes payable	20,900,000
	Interest expense	104,500
	Interest payable	522,500
	Cash		21,527,000