Answer: Please see answers in explanation ncolumn
Explanation:
Journal entry for Trico Technologies
1) To record issuance of notes
Date General Journal Debit Credit
Aug 1st 2021 Cash $19,700,000
Notes Payable $19,700,000
Adjustment for Interest
= Principal x rate x time ( from August to December 31st)
$19,700,000 X 9% X 5/12=$738,750
To record accrual of interest at Year end.
Date General Journal Debit Credit
Dec 31st,2021 Interest expense $738,750
Interest payable $738,750
3. Record Payment of Note at maturity
Date General Journal Debit Credit
Jan 31st,2022 Notes payable $19,700,000
Interest Expense $147,750
Interest payable $738,750
Cash $20,586,500
Interest Expense =Principal x rate x time ( the remaining one month
$19,700,000 X 9% X 1/12=$147,750
