Question

4.40 8.9 9.10 PROBLEMS-SET A P10-1A. Journal Entries for Accounts and Notes Payable Lyon Company had the following transactions: 8 Issued a 6,000, 60-day, six percent note payable in payment of an account with Bennett Company. 15 Borrowed $40,000 from Lincoln Bank, signing a 60-day note at nine percent. 7 Paid Bennett Company the principal and interest due on the April 8 note payable. 6 Purchased $14,000 of merchandise from Bolton Company; signed a 90-day note with LO1 Аpг. MBC Мay June July ten percent interest. 14 Paid the May 15 note due Lincoln Bank July

Answer 1

Journal entry

date	account and explanation Debit	Credit
Apr 8	Account payable	6000
	Notes payable-Bennett Company		6000
May 15	Cash	40000
	Notes payable-Lincoln		40000
June 7	Notes payable-Bennett Company	6000
	Interest expense (6000*6%*60/360)	60
	Cash		6060
July 6	Purchase	14000
	Notes payable-Bolton Company		14000
July 14	Notes payable-Lincoln Company	40000
	Interest expense (40000*9%*60/360)	600
	Cash		40600
Oct 2	Cash	30000
	Notes payable-Lincoln Bank		30000
Oct 4	Notes payable-Bolton Company	14000
	Interest expense (14000*10%*90/360)	350
	Account payable		14350

Adjusting entry

Date	account and explanation	Debit	Credit
Dec 31	Interest expense (30000*9%*90/360)	675
	Interest payable		675