Only July 1 1999, Bobby's Car Repair Shop borrowed $50,000 from the bank. Bobby, the owner signed an 8%, 10-month interesting bearing note and promised to repay the note plus interest at maturity date. Bobby's uses a calendar year-end (December 31).
Record the note on July 1, the adjustment at end of calendar year, and the repayment of the note in 10 months. (Assume the 8% is an annual rate of interest).
Assets = Liabilities +Equity +Revs. -Exps