Journal entries to record each of the three transactions

Assignment Help Financial Accounting

Reference no: EM131219761

At the beginning of the year, Lambert Motors issued the three notes described below. Interest is paid at year-end. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) A. The company issued a two-year, 10%, $730,000 note in exchange for a tract of land. The current market rate of interest is 10%. B. Lambert acquired some office equipment with a fair value of $157,500 by issuing a one-year, $165,000 note. The stated interest on the note is 5%. C. The company purchased a building by issuing a two-year installment note. The note is to be repaid in equal installments of $1 million per year beginning one year hence. The current market rate of interest is 8%.

Prepare the journal entries to record each of the three transactions and the interest expense at the end of the first year for each. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations. Enter your answers in whole dollar.)

Reference no: EM131219761

Questions Cloud

Prepare an amortization schedule for the four-year term : American Food Services, Inc., acquired a packaging machine from Barton and Barton Corporation. Barton and Barton completed construction of the machine on January 1, 2016. Prepare the journal entry for American Food Services’ purchase of the machine o..

Journal entry to record their issuance by strauss-lombardi : On February 1, 2016, Strauss-Lombardi issued 8% bonds, dated February 1, with a face amount of $600,000. The bonds sold for $544,796 and mature on January 31, 2036 (20 years). The market yield for bonds of similar risk and maturity was 9%. Prepare th..

Provide an overview of the macro environment : Identify the key drivers of the industry and how it works. This would mean trace and analyse the environmental and industry trends, power distribution, well as the bargaining potter of the channel partner.

Explore the biblical basis for the state of nature argument : Explore the biblical basis for the state of nature argument. Is the concept of the state of nature compatible with Christianity? Why or why not?

Journal entries to record each of the three transactions : At the beginning of the year, Lambert Motors issued the three notes described below. Interest is paid at year-end. Prepare the journal entries to record each of the three transactions and the interest expense at the end of the first year for each.

Explain its uses by policymakers and interest groups : Define what public opinion means and explain its uses by policymakers and interest groups. Point out the differences between consensus opinion and divided opinion.

Determine the price of the bonds issued : On February 1, 2016, Cromley Motor Products issued 9% bonds, dated February 1, with a face amount of $60 million. The bonds mature on January 31, 2020 (4 years). The market yield for bonds of similar risk and maturity was 10%. Determine the price of ..

Failing to plan suggests doing nothing : There is an old expression: If we fail to plan, we plan to fail. Failing to plan suggests doing nothing. Since planning is an active pursuit, how can doing nothing be indicative of planning? to fail?

What amount of interest expense related to the bonds : The fiscal year ends December 31 for Lake Hamilton Development. To provide funding for its Moonlight Bay project, LHD issued 5% bonds with a face amount of $650,000 on November 1, 2016. The bonds sold for $574,879, a price to yield the market rate of..

User Account

All Pages