Use the information in RE3 7,
(a) Assuming Ranee Company makes reversing entries, prepare the reversing entry on January 1, 2011, and the journal entry to record the payment of the note on April 1, 2011;
(b) Assuming Ranee Company does not make reversing entries, prepare the journal entry to record the payment of the note on April 1, 2011.
In RE3 7, On April 1, 2010, Ranee Company borrowed $20,000 from its bank by issuing a 9%, 12 month note, with the interest to be paid on the maturity date. Prepare journal entries to record the issuance of the note and the related year end adjusting entry.