Based on the details given by LCD Industries such as the amount of the note and the interest rate, the journal entries are:
Date Account title Debit Credit
Nov. 1 2021 Inventory $24,000,000
Note payable $24,000,000
Nov. 30, 2021 Interest expense $240,000
Note payable $1,892,366.66
Cash $2,132,366.66
Amount of interest to be reported in income statement = $481,076.33.
<h3>What are the journal entries?</h3>
Inventory will be debited with the payment amount of $24 million. This amount will also be credited to the Note payable account.
The interest expense will be:
= 24,000,000 x 12% x 1/12 months
= $240,000
Cash payment:
= Amount / Present value interest factor of annuity, 1 year, 12%
= 24,000,000 / 11.2551
= $2,132,366.66
<h3>What is the amount of interest to be reported in the income statement?</h3>
= Interest expense in November + (Note amount - note payable for November ) x 1%
= 260,000 + (24,000,000 - 1,892,366.66) x 1%
= $481,076.33
Find out more on notes payable at brainly.com/question/25148915.
