Answered

Welcome to Westonci.ca, the place where your questions are answered by a community of knowledgeable contributors. Get accurate and detailed answers to your questions from a dedicated community of experts on our Q&A platform. Join our platform to connect with experts ready to provide precise answers to your questions in different areas.

On January 1, 2019, Brooks Inc. borrows $90,000 from a bank and signs a 5% installment note requiring four annual payments of $25,381 at the end of each year. The first installment payment is made on December 31. Complete the necessary journal entry on 12/31 by selecting the account names from the drop-down menus and entering the dollar amounts in the debit or credit columns.

Sagot :

Parrain

Answer:

Date                 Account Title                                         Debit                Credit

12/31/2019        Notes Payable                                     $4,500

                         Interest expense                                 $20,881

                         Cash                                                                             $25,381

Working

Interest expense = 5% * 90,000

= $4,500

Notes payable = 25,381 - 4,500

= $20,881

This is the principal repayment amount.

We appreciate your time. Please revisit us for more reliable answers to any questions you may have. We hope this was helpful. Please come back whenever you need more information or answers to your queries. Stay curious and keep coming back to Westonci.ca for answers to all your burning questions.