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Problem - On August 31, 20X6, Nancy Thompson borrowed $2,200 from Yellow Interstate Bank. Thompson signed a note payable, promising to pay the bank principal plus interest on August 31, 20X7. The interest rate on the note is 9%. The accounting year of Yellow Interstate Bank ends on June 30, 20X7.
Required - Journalize Yellow Interstate Bank's (a) lending money on the note receivable at August 31, 20X6, (b) accrual of interest at June 30, 20X7, and (c) collection of principal and interest at August 31, 20X7, the maturity date of the note.
Financial Statement Analysis and Preparation
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