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Entries for the note payable

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There are three parts to this question. I want to ensure that I have worked this problem correctly.

On March 1, Henson Company borrows $90,000 from Lyon State Bank by signing a 6-month, 10%, interest bearing note.

A) Prepare the entry on March 1 when the note was issued.
B) Prepare any adjusting entries necessary on June 30 in order to prepare the semi-annual financial statements. Assume no other interest accrual entries have been made.
C) Prepare the entry to record payment of the note at maturity.

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Solution Summary

The solution explains the journal entries relating to various transactions with notes payable.

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A) Prepare the entry on March 1 when the note was issued.

The entry would record the receipt of cash and the creation of liability
The entry is
March 1 Cash Dr 90,000
Notes Payable Cr 90,000

B) Prepare any ...

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