Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Accounting Basics Expert

On December 1, Showcase Interiors purchased a shipment of furniture from Colonial House by paying $10,500 cash and issuing an installment note payable in the face amount of $28,800. The note is to be paid in 24 monthly installments of $1,200 each. Although the note makes no mention of an interest charge, the rate of interest usually charged to Showcase Interiors in such transactions is 1½ percent per month.

a. Compute the present value of the note payable, using a discount rate of 1½ percent per month.

b. Prepare the journal entries in the accounts of Showcase Interiors on:

1. December 1, to record the purchase of the furniture (debit Inventory).
2. December 31, to record the first $1,200 monthly payment on the note and to recognize interest expense for one month by the effective interest method.

c. Show how the liability for this note would appear in the balance sheet at December 31. (Assume that the note is classified as a current liability.)

Accounting Basics, Accounting

  • Category:- Accounting Basics
  • Reference No.:- M944453

Have any Question? 


Related Questions in Accounting Basics

Sarbanes oxley requires that per section 404 that internal

Sarbanes Oxley requires that per Section 404 that Internal Controls within a publicly held company are to be reviewed, evaluated and tested at year end to insure that adequate controls are in place. In addition to unders ...

Palmona co establishes a 220 petty cash fund on january 1

Palmona Co. establishes a $220 petty cash fund on January 1. On January 8, the fund shows $125 in cash along with receipts for the following expenditures: postage, $41; transportation-in, $11; delivery expenses, $13; and ...

Assignmentpart 11 which of the following would cause a

Assignment Part 1 1. Which of the following would cause a contra-asset to be credited and an expense debited? a. Recording an accrued expense b. Recording the consumption of supplies c. Recording the building depreciatio ...

Company name bhp billiton - report 2000-2200

Company Name BHP Billiton - Report (2000-2200) words Introduction Approach of research study What they have done wrong which results in the crisis Issues in sustainability report Issues in what they claim of doing but th ...

Cost accounting systemsconsider the places of employment of

Cost Accounting Systems Consider the places of employment of the team members or businesses with which the team is familiar and the industries in which they operate. Create a 12-slide presentation, including detailed spe ...

Accounting assignmentthis project requires you to select a

Accounting Assignment This project requires you to select a business and analyze part of its accounting information system. You will focus on a selected business process, develop conclusions from your observations, and a ...

Taskas part of the planning process for your new accounting

TASK As part of the planning process for your new accounting information system, your manager has asked that you prepare flowcharts. This graphic presents the flow of information through the accounting cycles. • Using th ...

Dq1respond to the ethics discussion case at the end of

DQ1 Respond to the Ethics Discussion Case at the end of chapter 13 in the textbook. Assume that you are a CPA and a tax specialist. Your clients include Ale and Grains, Inc., an S corporation, and Gustav and Heidi Lager, ...

Assignmentapplication break-even analysiswhen expenses and

Assignment Application: Break-Even Analysis When expenses and revenues are equal, this is known as the "break-even point" or BEP. To determine break-even, an examination of fixed and variable costs (expenses) in relation ...

Question 1the financial statement that shows revenue and

Question 1 The financial statement that shows revenue and expenses for a period of time is the A. balance sheet. B. income statement. C. statement of owner's equity. D. statement of cash flows. Question 2 If a company's ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

WalMart Identification of theory and critical discussion

Drawing on the prescribed text and/or relevant academic literature, produce a paper which discusses the nature of group

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro