On September 1,2006, Donna Equipment signed a one-year, 8% interest-bearing notepayable for $50,000. Assuming that Donna maintains its books on acalendar year basis, the amount of interest expense that should bereported in the 2007 income statement for this note (roundedto the nearest dollar) would be
Use the following to answer questions 1-3:
On July 1, 2009, Prism, Inc., borrowed $30,000 from First Bankon a one year, 10% note payable. Interest is payable on June30, 2010, the due date of the note. Their accounting year endsDecember 31, 2009.
11. The journal entry required on the company's books to record the note payable on July 1, 2009would include a
12. The journal entry required on the company's books to record the interest paid on December 31,2009, would include a
13. On the company's 2009 year-end balance sheet, the notes payable account should bereported as a