Question

On October​ 1, 2019, ABC Company loaned A. Jenkins​ $9,000 at an annual interest rate of​...

On October​ 1, 2019, ABC Company loaned A. Jenkins​ $9,000 at an annual interest rate of​ 5% with a maturity date of April​ 1, 2020. On October​ 1, 2019, ABC Company will record​ __________.

A. a credit to Notes Payablelong — A. Jenkins of​ $9,000

B. a debit to Notes Receivable—A. Jenkins of​ $9,450

C. no entry since the note is due on April​ 1, 2020

D. a debit to Notes Receivable —A. Jenkins of​ $9,000

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

Correct answer is option (D). A debit to Notes Receivable —A. Jenkins of​ $9,000

Explanation;

When a company gives loan to other party then company will record such loan amount by debiting notes receivable and by crediting cash account.

Thus option (D) is correct answer because in this option A debit to notes receivable – A Jenkins is made.

At the time of giving loans we will record with the face value of note receivable only, interest will not be included in such value because interest will be recorded at the end of year.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
A company lends its supplier $152,000 for 3 years at a 8% annual interest rate. Interest...
A company lends its supplier $152,000 for 3 years at a 8% annual interest rate. Interest payments are to be made twice a year. The entry to record this lending transaction includes a debit to: Cash and a credit to Notes Payable for $152,000. Notes Receivable and a credit to Cash for $152,000. Interest Receivable and a credit to Interest Revenue for $6,080. Cash and a credit to Interest Revenue for $12,160. On July 1, 2016, Empire Inc. lends $18,000...
On November 1, Jay Company loaned an affiliate $100,000 at a 9.0% interest rate. The note...
On November 1, Jay Company loaned an affiliate $100,000 at a 9.0% interest rate. The note receivable plus interest will not be collected until March 1 of the following year. The company's annual accounting period ends on December 31. The adjusting entry needed on December 31 is: A) Debit Interest Receivable, $750; credit Interest Revenue, $750. B) Debit Interest Expense, $750; credit Interest Payable, $750. C) Debit Interest Expense, $1,500; credit Interest Payable, $1,500. D) Debit Interest Receivable, $2,250; credit...
A company lends its supplier $159,000 for 3 years at a 9% annual interest rate. Interest...
A company lends its supplier $159,000 for 3 years at a 9% annual interest rate. Interest payments are to be made twice a year. The entry to record this lending transaction includes a debit to: Multiple Choice Cash and a credit to Interest Revenue for $14,310. Cash and a credit to Notes Payable for $159,000. Interest Receivable and a credit to Interest Revenue for $7,155. Notes Receivable and a credit to Cash for $159,000.
Oriole Company loaned $68,760 to Hemingway, Inc, accepting Hemingway's 2-year, $83,200, zero-interest-bearing note. The implied interest...
Oriole Company loaned $68,760 to Hemingway, Inc, accepting Hemingway's 2-year, $83,200, zero-interest-bearing note. The implied interest rate is 10%. Prepare Oriole's journal entries for the initial transaction, recognition of interest each year, and the collection of $83,200 at maturity. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit (To record the receipt of the note at a discount.) (To record the interest revenue at the end of 1st...
Entries for Notes Receivable Valley Designs issued a 90-day, 8% note for $90,000, dated April 19,...
Entries for Notes Receivable Valley Designs issued a 90-day, 8% note for $90,000, dated April 19, to Bork Furniture Company on account. Assume 360 days in a year when computing the interest. a. Determine the due date of the note. July 18 b. Determine the maturity value of the note. $ Feedback The due date is the date the note is to be paid. Remember the interest rate is stated on an annual basis, while the term is expressed as...
On January 1, 2017, Trinity Company loaned $901,560 to Litton Industries in exchange for a 3...
On January 1, 2017, Trinity Company loaned $901,560 to Litton Industries in exchange for a 3 year, zero-interest-bearing note with a face amount, $1,200,000. The prevailing rate of interest for a loan of this type is 10%. The adjusting journal entry made by Litton at December 31, 2017 with regard to the note will include a debit to Interest Expense for $120,000. a debit to Interest Expense for $29,850. a credit to Discount on Notes Payable for $90,156. a credit...
On April 1, 2020, Coronado Company assigns $550,000 of its accounts receivable to the Third National...
On April 1, 2020, Coronado Company assigns $550,000 of its accounts receivable to the Third National Bank as collateral for a $324,000 loan due July 1, 2020. The assignment agreement calls for Coronado to continue to collect the receivables. Third National Bank assesses a finance charge of 4% of the accounts receivable, and interest on the loan is 10% (a realistic rate of interest for a note of this type). Prepare the April 1, 2020, journal entry for Coronado Company....
Question 17 Crane Company loaned $52,893 to Hemingway, Inc, accepting Hemingway's 2-year, $64,000, zero-interest-bearing note. The...
Question 17 Crane Company loaned $52,893 to Hemingway, Inc, accepting Hemingway's 2-year, $64,000, zero-interest-bearing note. The implied interest rate is 10%. Prepare Crane's journal entries for the initial transaction, recognition of interest each year, and the collection of $64,000 at maturity. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit (To record the receipt of the note at a discount.) (To record the interest revenue at the end...
On January 1, 2019, Garcia Corporation purchased a truck by issuing an $80,000, 4-year, non-interesting bearing...
On January 1, 2019, Garcia Corporation purchased a truck by issuing an $80,000, 4-year, non-interesting bearing note to Equinox Inc. The note has a present value of $54,641. The market rate of interest for obligations of this nature is 10%. Instructions: Record the journal for the purchase of the equipment. Record the entry on Dec. 31, 2019 for interest. Record the entry on De 31, 2020 for interest. Date Debit Credit Jan. 1 2019 Dec. 31 2019 Dec. 31 2020
Oriole Company issued $640,000, 10%, 10-year bonds on December 31, 2019, for $570,000. Interest is payable...
Oriole Company issued $640,000, 10%, 10-year bonds on December 31, 2019, for $570,000. Interest is payable annually on December 31. Oriole Company uses the straight-line method to amortize bond premium or discount. Prepare the journal entry to record the issuance of the bonds. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Dec. 31, 2019 Prepare the journal entry to record the payment of interest and the discount...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT