Looking for a little bit of clarification on these latter questions :
Nicknack's annual fire insurance policy of $2,400 was paid on April 1, 2014 and was fully expensed at that time.
DR Prepaid Exp - 2400
CR Insurance EXp 2400
On June 1, 2014 Nicknacks lent a long-time employee $15,000. She signed a promissory note agreeing to repay the amount on May 31, 2017. The interest rate is 5% per year with interest payable every May 31.
Cr Cash 15,00
Dr Notes Receivable 15,000
CR Int. Rev. (15,000 x .05) (3)= 2250
Dr Int Rev. 2250 (AR)
Rent of $5,000 per month has not been paid or recorded for the last two months.
DR Rent Exp 10,000
CR AP 10,000