On October 1, 20X4, River Woods purchased land by giving $200,000 in cash and executing a $800,000 note payable to the former owner. The note bears interest at 8% per annum, with interest being payable annually on September 30 of each year. Rojas is also required to make a $200,000 payment toward the note’s principal on every September 30.
a) Prepare the appropriate journal entry to record the land purchase on October 1, 20X4.
b) Prepare the appropriate journal entry to record the year-end interest accrual on December 31, 20X4.
The current liabilities section of the balance sheet contains obligations that are due to be satisfied in
the near term, and includes amounts relating to accounts payable, salaries, utilities, taxes, short-term
loans, and so forth. This casual description is inadequate for all situations, so accountants have
developed a very specific definition to deal with more issues.
Best Electronics operates a retail electronics company. Examine the following items and prepare the current liability section of the company’s December 31, 20X8, balance sheet.
The beginning of year accounts payable was $150,000. Purchases on trade accounts during the year were $975,000, and payments on account were $915,000.
Prepare journal entries to record each of the following independent stock issue situations.
a) Max Graphics Corporation issued 500,000 shares of $0.50 par value common stock. The issue price was $18 per share.
b) Aztec Corporation issued 35,000 shares of no par common stock for $25 per share.
c) Pyramid Play issued 60,000 shares of $50 par value preferred stock. The issue price was $76 per share.
d) Paradise Land Management issued 15,000 shares of $1 par value common stock for land with a fair value of $250,000....