Exercise 132 Part Level Submission The following are selecte

Exercise 13-2 (Part Level Submission) The following are selected 2017 transactions of Windsor Corporationn Sept. 1 Purchased inventory from Encino Company on account for $37,600. Windsor records purchases gross and uses a periodic inventory system. Oct. 1 Issued a $37,600, 12-month, 8% note to Encino in payment of account Oct. 1 Borrowed $37,600 from the Shore Bank by signing a 12-month, zero-interest-bearing $40,920 note. Your answer is correct. Prepare journal entries for the selected transactions above. (If no entry is required, select \"No Entry\" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. Record entries in the order displayed in the problem statement.) Date Account Titles and Explanatlon Debit Credit September 1Purchases 37600 Accounts Payable 37600 October 1 Accounts Payable 37600 Notes Payable 37600 October 1 Cash 37600 Discount on Notes Payable 3320 Notes Payable 40920 Click if you would like to Show Work for this question: Open Show Work

Solution

Solution c:

Total net liability to be reported on december 31 for Interest-bearing note = Note payable + Interest Payable on Dec 31 = $37600 + $752 = $38,352

Total net liability to be reported on december 31 for Zero Interest-bearing note = Note payable - Unamortized discount =$40920 - ($3320 - $830) = $40920 - $2490 = $38,430