LUS a Prepare the jounal entry to recerd the proceeds of the

LUS (a) Prepare the jounal entry to recerd the proceeds of the note. (b) Prepare the journal entry to record accrued interest at December 31, assuming adjusting entries are made only at the end of the y

Solution

Journal entry: Date Accounts title and explanations Debit $ Credit $ 1-Jul Cash Account Dr. 45000     Notes payable 45000 31-Dec Interest expense Account Dr. (45000*12%*6/12) 2700      Interest payable Account 2700