1.
Liabilities: Liabilities are debt and obligations of a business. These are the claims against the resources that a business owes to outsiders of the company. Liabilities may be Current liabilities, and Long-term liabilities. Examples: Creditors, Bills payable, Bank overdraft, Salaries and wages payable, and Notes payable.
To record: Notes payable on September 1, 2019.
2.
To Record: The employee payroll tax on September 30, 2019.
3.
To Record: The payment to employees.
4.
To record: Accrual interest due on the note at December 31, 2019.
5.
To record: The payment to the bank on September 1, 2020.
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