question archive Prepare the necessary Journal entries for the following transactions (a) on September 1, Cole Company borrowed $150
Prepare the necessary Journal entries for the following transactions (a) on September 1, Cole Company borrowed $150
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Prepare the necessary Journal entries for the following transactions (a) on September 1, Cole Company borrowed $150.000 from National Bank on a 6-month, 8 note. (b) On December 31, Cole Company accrued interest (asume adjusting entries are only made at the end of the year)
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a) September 1 Bank A/c Dr. $150,000
To Note Payables to National Bank $150,000
( Loan taken from National Bank on a 6-month, 8% Note)
b) December 31 Interest Expense A/c Dr. $3,000
To Interest payable to National Bank $3,000
(Interest accrued on the Loan booked)
Note : Interest is calculated as follows : $150,000 X 8% X 3/12 = $3,000
