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SVETLANKA909090 [29]
2 years ago
8

A gift shop signs a three-month note payable. The note is signed on November 30 in the amount of $50,000 with annual interest of

12%. What is the adjusting entry to be made on December 31 for the interest expense accrued to that date? *
Business
2 answers:
aliina [53]2 years ago
5 0

Answer:

the gift shop must recognize 31 days of accrued interest payable, total interest = principal x interest rate x time passed

= $50,000 x 12% x 31/365 days = $509.59

the adjusting entry should be:

December 31, accrued interest on note payable

Dr Interest expense 509.59

    Cr Interest payable 509.59

alexdok [17]2 years ago
4 0

Answer:

The adjusting entry to be made on December 31 for the interest expense accrued to that date is:

                               Debit  Credit

Interest expense 1,000

Interest payable  1,000

Explanation:

According to the given data we have the following:

Amount of Note = $ 50,000

Annual Interest = 12 % per annum

Period = 3 Months

Period Expired = 2 Months (i.e. November and December)

Therefore, The amount of outstanding interest is computed as $ 50,000 x 12/12 x 2 x 1/100 = $ 1,000

The adjusting entry to be made on December 31 for the interest expense accrued to that date is:

                               Debit  Credit

Interest expense 1,000

Interest payable  1,000

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Answer:

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Explanation:

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The price is the value which is given to the customers

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8 0
3 years ago
The higher the firm's flotation cost for new common equity, the more likely the firm is to use preferred stock, which has no flo
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Answer:

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Explanation:

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3 years ago
Why long hair on men fell out after the medieval times?
fiasKO [112]
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3 years ago
Any point inside a production possibilities curve is:_____.
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Explanation:

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2 years ago
Kulka Corporation manufactures two products: Product F82D and Product T05P. The company uses a plantwide overhead rate based on
aleksandr82 [10.1K]

Answer:

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Explanation:

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2 years ago
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