On July 1, 20X1, a company borrows $100,000 on a 5% note, due in one year. Assume accrued interest was recorded on December 31. What accounts would be impacted at the time of repayment of the note and interest on June 30, 20X2?
14. (Multiple Choice)On July 1, 20X1, a company borrows $100,000 on a 5% note, due in one year. Assume
accrued interest was recorded on December 31. What accounts would be impacted at the time of repayment of the note and interest on June 30, 20X2?
A. Interest Expense, by $5,000. B. Notes Payable, by $105,000. C. Cash, by $100,000. D. Interest Payable, by $2,500. E. None of these.
16. (Multiple Choice)
Eastland Company regularly sells goods to customers who use American City bank credit cards. Credit card sales on July 8 amounted to $1,000 and were subject to a 2% bank fee. Eastland should record sales of:
A. $980. B. $998. C. $1,000. D. $1,020. E. None of these.
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