Selected accounts from WooHoo Co's adjusted trial balance
Notes payable (due in 5 years) $3,000 Discount on bonds payable $400
Accounts payable 500 Wages payable 200
Bond payable (due in 10 years) 10,000 Interest payable 100
Machinery 4,500 Sales tax payable 50
Prepare the liabilities section of its classified balance sheet. (Negative amounts indicated by a minus sign)
(3) On November 1, 2019, Norwood borrows $200,000 cash from a bank by signing a five year installment
note. The note requires equal payments of $50,091 each year on October 31 bearing 8% interest.
Complete an amortization table for this installment note.
Prepare the journal entries in which Norwood records the following"
(a) Accrued interest as of December 31,2019 (the end of its annual reporting period)
(b) The first annual payment on the note.
Sample Solution