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Gelneren [198K]
3 years ago
14

HELP PLZ

Advanced Placement (AP)
1 answer:
svetlana [45]3 years ago
7 0

Answer:D

Explanation: I'm smarter than u

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A business issued a 90-day, 5% note for $10,000 to a creditor on account. The company uses a 360-day year for interest calculati
Vera_Pavlovna [14]

Answer: See explanation

Explanation:

a. The Journal entries to record the issuance of the note will be:

Debit Accounts payable $10000

Credit Notes payable $10000

(To record the issuance of note to creditor)

b. The journal entry to record thehe payment of the note at maturity, including interest will be:

Debit Notes payable $10000

Debit Interest expense $125

Credit Cash $10000 + $125 = $10125

(To record the payment on the note on maturity.

Note:

Interest expense = $10000 × 5% × 90/360

= $10000 × 0.05 × 0.25

= $125

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