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Sunday, November 14, 2010

Valix Finacc vol 1 Problem 15-6

Financial Accounting Volume 1 2008 Valix-Peralta
Chapter 1 Problem 15-6


    2008                                                            
Jan.    1   Equipment                                                                           580,000
                Discount on note payable                                                  120,000
          Cash                                                                                                      200,000
                      Note payable                                                                                        500,000                                                                                                                        
Dec.  31   Note payable                                                                      100,000
                      Cash                                                                                                      100,000

          31   Interest expense                                                                    40,000
                      Discount on note payable                                                                      40,000

                                    Note payable              Fraction           Amortization
                 2008                  500,000                       5/15                   40,000
                 2009                  400,000                       4/15                   32,000
                 2010                  300,000                       3/15                   24,000
                 2011                  200,000                       2/15                   16,000
                 2012                  100,000                      1/15                     8,000
                                       1,500,000                                               120,000

   2009
Dec. 31    Note payable                                                                      100,000
                      Cash                                                                                                      100,000

         31    Interest expense                                                                    32,000
                      Discount on note payable                                                                      32,000

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