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dsp73
3 years ago
10

On January 1, Franz Co. accepted a 30-day, 6% note in the amount of $5,000 from Bria Co., a customer. On January 31, the due dat

e of the note, Bria honors the note and pays in full. The journal entry that Franz would make to record payment of this note would include a:
A) debit to Cash for $5,025.
B) credit to Note Receivable for $5,000.
C) credit to Interest Revenue for $25.
Business
1 answer:
Blababa [14]3 years ago
4 0

Answer:

The answer is:

Dr Cash $5,025

Cr: Receivable $5,000

Cr: Interest Revenue $25

Explanation:

The year is 360 days.

Annual rate is 6%

Therefore, interest rare for the 30-day is 1.5%[(90/360) x 6%]

So, the interest on the rate is:

0.5% x $5,000

$25.

The total amount collected from Bria will be principal + interest

$5,000 + $25 = $5,025

According to the accounting rule, debit increases asset and expenses and vice-versa while credit decreases liability, equity, income and vice versa.

So we have:

Dr Cash $5,025

Cr: Receivable $5,000

Cr: Interest Revenue $25

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Walnut has forecast sales for the next three months as follows: July 4,900 units, August 6,900 units, September 8,000 units. Wal
Andreas93 [3]

Answer:

the budgeted selling and administrative expenses for July is $64,100

Explanation:

The computation of the budgeted selling and administrative expenses for July is shown below:

= Budgeted selling & admin cost + (per unit sold × July units)

= $20,000 + ($9 × 4,900 units)

= $20,000 + $44,100

= $64,100

hence, the budgeted selling and administrative expenses for July is $64,100

We simply applied the above formula

3 0
2 years ago
Cliff Co. wants to purchase a machine for $42,000, but needs to earn a return of 11%. The expected year-end net cash flows are $
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Answer:

54 percent

Explanation:

3 0
2 years ago
Rainey Enterprises loaned $40,000 to Small Co. on June 1, Year 1, for one year at 6 percent interest. Required Show the effects
MariettaO [177]

<u>Explanation:</u>

Cash flow is a statement which shows the amount of cash inflow and outflow of the company. With the help of the cash flow statement the company can determine its efficiency in managing the debt and credit in the company.

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7 0
2 years ago
Suppose Lois usually buys two cups of coffee for two dollars each and one scone for two dollars each. If the price of scones fal
777dan777 [17]

Answer:

The correct answer is D. Real income effect.

Explanation:

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4 0
3 years ago
Azure Inc. assigns $4,000,000 of its accounts receivables as collateral for a $3 million loan with a bank. The bank assesses a 3
Vlad1618 [11]

Answer with its Explanation:

Step 1:

First of all record a loan of $3 million loan:

Dr Bank $3,000,000

Cr Loan      $3,000,000

Step 2:

Finance charge will be 3% on this loan amount:

Dr Finance Charge $3million *3% = $90,000

Cr                   Bank                                       $90,000

Step 3:

The interest on the note is 7% which is $70,000. So the journal entry would be:

Dr Interest Expense $70,000

Cr Interest payable                  $70,0000

8 0
3 years ago
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