Reference no: EM13938243
INTEREST-BEARING NOTE REPLACING AN UNPAID ACCOUNT PAYABLE
Conti Products owed $50,000 on account for inventory purchased on December 1, 2010. Conti's fiscal year ends on December 31. Conti was unable to pay the amount owed by the February 28 due date because of financial difficulties. On March 1, 2011, Conti signed a $50,000, 10 percent interest-bearing note. This note was repaid with in- terest on September 1, 2011.
Required:
1. Prepare the entry recorded on December 1, 2010.
2. Prepare the adjusting entry recorded on December 31, 2010.
3. Prepare the entry recorded on March 1, 2011.
4. Prepare the entry recorded on September 1, 2011.
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