At January 1, 2018, Brant Cargo acquired equipment by issuing a five-year, $150,000 (payable at maturity), 4%note. The market rate of interest for notes of similar risk is 10%.Required:1. Prepare the journal entry for Brant Cargo to record the purchase of the equipment.2. Prepare the journal entry for Brant Cargo to record the interest at December 31, 2018.3. Prepare the journal entry for Brant Cargo to record the interest at December 31, 2019.
At January 1, 2018, Brant Cargo acquired equipment by issuing a five-year, $150,000 (payable at maturity), 4%note. The market rate of interest for notes of similar risk is 10%.Required:1. Prepare the journal entry for Brant Cargo to record the purchase of the equipment.2. Prepare the journal entry for Brant Cargo to record the interest at December 31, 2018.3. Prepare the journal entry for Brant Cargo to record the interest at December 31, 2019.
Chapter13: Long-term Liabilities
Section: Chapter Questions
Problem 1PA: On January 1, 2018, King Inc. borrowed $150,000 and signed a 5-year, note payable with a 10%...
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At January 1, 2018, Brant Cargo acquired equipment by issuing a five-year, $150,000 (payable at maturity), 4%
note. The market rate of interest for notes of similar risk is 10%.
Required:
1. Prepare the
2. Prepare the journal entry for Brant Cargo to record the interest at December 31, 2018.
3. Prepare the journal entry for Brant Cargo to record the interest at December 31, 2019.
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