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question a business issued a 30 day 7 note for 67 200 to a creditor on account the c 4289758

Question

A business issued a 30-day, 7% note for $67,200 to a creditor on account. The company uses a 360-day year for interest calculations.

Journalize the entries to record (a) the issuance of the note on April 30 and (b) the payment of the note at maturity, including interest. Refer to the Chart of Accounts for exact wording of account titles. There should be five rows for this journal.

Chart of Accounts…

 

Required:

 

Journalize the entries to record (a) the issuance of the note on April 30 and (b) the payment of the note at maturity, including interest. Refer to the Chart of Accounts for exact wording of account titles. There should be five rows for this journal.

Chart of Accounts…

ASSETS

 

110

Cash

111

Accounts Receivable

112

Interest Receivable

113

Notes Receivable

115

Merchandise Inventory

116

Supplies

118

Prepaid Insurance

120

Land

123

Building

124

Accumulated Depreciation-Building

125

Office Equipment

126

Accumulated Depreciation-Office Equipment

   

 

 

LIABILITIES

210

Accounts Payable

213

Interest Payable

214

Notes Payable

215

Salaries Payable

216

Social Security Tax Payable

217

Medicare Tax Payable

218

Employees Federal Income Tax Payable

219

Employees State Income Tax Payable

220

Medical Insurance Payable

221

Retirement Savings Deductions Payable

222

Union Dues Payable

224

Federal Unemployment Tax Payable

225

State Unemployment Tax Payable

226

Vacation Pay Payable

228

Product Warranty Payable

 

 

EQUITY

310

Common Stock

311

Retained Earnings

312

Dividends

313

Income Summary

 

REVENUE

410

Sales

610

Interest Revenue

 

 

EXPENSES

510

Cost of Merchandise Sold

520

Salaries Expense

525

Delivery Expense

526

Repairs Expense

531

Rent Expense

533

Insurance Expense

534

Supplies Expense

535

Payroll Tax Expense

536

Vacation Pay Expense

538

Cash Short and Over

539

Product Warranty Expense

541

Depreciation Expense-Building

542

Depreciation Expense-Office Equipment

590

Miscellaneous Expense

710

Interest Expense

 

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