PROBLEM 2 (MODIFIED) Winter Corporation received the following notes in 2020: NOTE DATE PRINCIPAL AMOUNT INTEREST RATE TERM A August 31 Php 200,000 10% 6 months B October 19 Php 250,000 12% 90 days C November 11 Php 300,000 11% 1 year REQUIRED: Determine the due date, amount of interest, and maturity value of each note. Compute interest using a 360-day year for those notes with terms specified in days or years. Round all interest amounts to the nearest peso. Journalize a single adjusting entry at December 31, 2020 to record accrued interest revenue on all three notes. Journalize the collection of principal and interest on Note B.
PROBLEM 2 (MODIFIED) Winter Corporation received the following notes in 2020: NOTE DATE PRINCIPAL AMOUNT INTEREST RATE TERM A August 31 Php 200,000 10% 6 months B October 19 Php 250,000 12% 90 days C November 11 Php 300,000 11% 1 year REQUIRED: Determine the due date, amount of interest, and maturity value of each note. Compute interest using a 360-day year for those notes with terms specified in days or years. Round all interest amounts to the nearest peso. Journalize a single adjusting entry at December 31, 2020 to record accrued interest revenue on all three notes. Journalize the collection of principal and interest on Note B.
Financial Accounting: The Impact on Decision Makers
10th Edition
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Gary A. Porter, Curtis L. Norton
Chapter9: Current Liabilities, Contingencies, And The Time Value Of Money
Section: Chapter Questions
Problem 9.12E
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PROBLEM 2 (MODIFIED) Winter Corporation received the following notes in 2020:
|
NOTE |
DATE |
PRINCIPAL AMOUNT |
INTEREST RATE |
TERM |
|
A |
August 31 |
Php 200,000 |
10% |
6 months |
|
B |
October 19 |
Php 250,000 |
12% |
90 days |
|
C |
November 11 |
Php 300,000 |
11% |
1 year |
REQUIRED:
- Determine the due date, amount of interest, and maturity value of each note. Compute interest using a 360-day year for those notes with terms specified in days or years. Round all interest amounts to the nearest peso.
- Journalize a single
adjusting entry at December 31, 2020 to record accrued interest revenue on all three notes. - Journalize the collection of principal and interest on Note B.
- On the due date, the maker dishonored Note A. Prepare the
journal entry to record the default of the maker.
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