Live Media Co. borrowed $125,000 on May 1, 2021 from OneUnited Bank by signing a $125,000, 11%, 8-month note payable. Purpose The purpose of this problem is to demonstrate an understanding of recording notes payable transactions. Instructions After analyzing the information, prepare Live Media Co.'s journal entries to: (1) record the proceeds of the note, (2) record accrued interest at December 31, 2021 and (3) record the payment of the note and interest at the note's maturity date of January 1, 2022. Guidance For formatting guidance, see the notes payable journal entry examples that are provided in Chapter 10 of the textbook.
Problem 1 - Record notes payable transactions
Live Media Co. borrowed $125,000 on May 1, 2021 from OneUnited Bank by signing a $125,000, 11%, 8-month note payable.
Purpose
The purpose of this problem is to demonstrate an understanding of recording notes payable transactions.
Instructions
After analyzing the information, prepare Live Media Co.'s journal entries to: (1) record the proceeds of the note, (2) record accrued interest
at December 31, 2021 and (3) record the payment of the note and interest at the note's maturity date of January 1, 2022.
Guidance
For formatting guidance, see the notes payable
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