2 on december 1 2013 fine products borrowed 80 000 on a 4 8 year 575409

Aug 29, 2021 | Uncategorized

Accounting 112 Exam #3 Chapter 14 Name 1.// CT (lc (..7“44 1. On March 1, 2015, Vinnie Services issued a 5% long term notes payable for $15,000. It is payable over a 3 year term in $5,000 principal installments on March 1 of each year, be innin March 1 2016. Prepare the journal entry.

DATE . EXPLANATION . DEBIT CREDIT MIR 111 COS h I5, bOb neffilet DJ 1 k ii a 15, OCCi

2. On December 1, 2013, Fine Products borrowed $80,000 on a 4%, 8 year note with annual installment payments of $10,000 plus interest due on December 1 of each succeeding year. On December 1, the principal amount was initially recorded as long term notes payable. What amount of the note payable will be shown as current portion of Long Term Note Payable on the balance sheet as of December 31, 2013? A) $10,000 B) $13,200 C) $3,200 D) $20,000

3. Trek Company signed a 9%, 10 year note for $150,000. The company paid $1,900 as the installment for the first month. What portion of the first monthly payment is interest expense? A) $4,800 B) $16,000 C) $14,400 D) $1,125

4. Trek Company signed a 9%, 10 year note for $150,000. The company paid $1,900 as the installment for the first month. ter the first payment, what is the updated principal balance?

• A)

147,625 B) $159,430 C) $149,225 D) $159,100

5. In order to expand business, the management of Vereos Inc. decided to issue long term notes payable for 550,000. The instrument carries interest at the rate of 12% with 10 equal yearly installments, beginning in one year. What will be the journal e

itry at the inception? DATE EXPLANATION DEBIT CREDIT

6. ) In order to expand business, the management of Vereos Inc. decided to issue Long term notes payable for $50,000. The note will be paid over ten years with payments of $5,000 plus 12% interest. Provide the journal entry needed after 1 year for

he first installment payment. DATE EXPLANATION DEBIT CREDIT

7. on January 1, 2015, Bratios Company purchased equipment and signed a 6 year mortgage note for $80,000 at 15%. The note will be paid in equal annual installments of $21,139. beginning January 1, 2016. On January 1, 2016, the journal entry to record the first installment payment will include a: