The following are selected 2017 transactions of Stellar Corporation. Sept. 1 Purchased inventory...
Question:
The following are selected 2017 transactions of Stellar Corporation.
| Sept. 1 | Purchased inventory from Encino Company on account for $58,800. Stellar records purchase gross and uses a periodic inventory system. |
| Oct. 1 | Issued a $58,800, 12-month, 8% note to Encino in payment of the account. |
| Oct. 1 | Borrowed $58,800 from the Shore Bank by signing a 12-month, zero-interest-bearing $61,760 note. |
a. Prepare journal entries for the selected transactions above.
b. Prepare adjusting entries at December 31.
Adjusting Entries:
Adjusting entries are those journal entries which are made to correct the account balance or close a temporary account. Adjusting entries are usually made at the end of the accounting period.
Answer and Explanation: 1
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View this answerJournal entry for transaction and the adjusting entries for interest expense are discount on note payable is shown below:
| Date | Particulars | Debit ($) | Cr... |
|---|
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Adjusting Entries: Definition, Types & Examples
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Chapter 22 / Lesson 16
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