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puteri [66]
3 years ago
11

On January 1, 2015, Johnson Company purchased a delivery truck for $72,000, paying $7,200 cash and financing the rest with a 4 y

ear, 5% note, with monthly payments of $1,411.
Required:

a. Complete the loan amortization schedule below for the payments made on February 1 and March 1.
b. Prepare the journal entry for the purchase on January 1.
c. Prepare the journal entry for the 2nd loan payment on March 1
Business
1 answer:
Kaylis [27]3 years ago
5 0

Answer and Explanation:

The computation is shown below:

a. Amortization schedule

<u>Date       Payment          Interest          Principal      Loan Balance</u>

Jan 1                                                                          $64,800

                                                                                ($72,000 - $7,200)

Feb 1           $1,411            $270             $1,141            $63,659

                          ($64,800 × 5% ÷ 12)

Mar 1           $1,411           $265             $1,146            $62,513

                             ($63,659 × 5% ÷ 12)

b. The journal entry is

Truck - equipment Dr $72,000

        To cash  $7,200

         To Note payable $64,800

(Being the purchase is recorded)

c. The journal entry is

Note payable $1,146

Interest expense $265

        To Cash $1,141

(Being loan payment is recorded)

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Answer:

b.$1,150

Explanation:

Sales Collection   $5,000*.98                      $4,900

Payment of purchases  $5,000*50%            ($2,500)

Other payments            $5,000*25%             ($1,250)

Net Cash flow during a typical month             $1,150      

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3 years ago
Wendell Company provided the following pertaining to its recent year of operation:
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Answer:

Option (B) is correct.

Explanation:

Wendell's total stockholders' equity increase during the recent year of operation:

= Issued common stock - Cash dividend declared + Net Income - Stock dividend distributed + Sale of treasury stock below cost

= $50,000 - $20,000 + $70,000 - $23,000 + $7,000

= $84,000

Therefore, Wendell's total stockholders' equity increase by $84,000.

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Patagonia, a multinational sports apparel company, is planning to launch its extreme weather gear product line in Nepal and the
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Answer: Create a sales plan that aims to enhance initial sales and market penetration with low prices based on high operational costs.

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6 0
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The following revenue and expense account balances were taken from the ledger of Wholistic Health Services Co. after the account
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Answer:

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Income Statement for the year end February 28, 2019

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Less: Supplies Expense                <u>$3,000    </u>

Gross Income                                  $267,900

Less operating Expenses:

Insurance Expense         $4,000

Depreciation Expense    $9,000

Miscellaneous Expense $6,000

Utilities Expense             $1,760

Rent Expense                  $4,200

Wages Expense              <u>$213,000</u>

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Net Income                                    <u>$29,940  </u>    

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