(Learning Objective 1: Recording note payable transactions) Joy’s Lahaina Grill completed the following note payable transactions.
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20X6 |
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July1 |
Purchased kitchen equipment costing $60,000 by issuing a 1 year, 8% note payable. |
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Dec. 31 |
Accrued interest on the note payable. |
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20X7 |
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July 1 |
Paid the note payable at maturity. |
1. How much interest expense must be accrued at December 31, 20X6?
2. Determine the amount of Joy’s final payment on July 1, 20X7.
3. How much interest expense will Joy’s report for 20X6 and for 20X7?