Reference no: EM131912814

Problem

Martinez Corporation sells rock-climbing products and also operates an indoor climbing facility for climbing enthusiasts. During the last part of 2017, Martinez had the following transactions related to notes payable.

Sept. 1 Issued a $14,400 note to Pippen to purchase inventory. The 3-month note payable bears interest of 9% and is due December 1. (Martinez uses a perpetual inventory system.)

Sept. 30 Recorded accrued interest for the Pippen note.

Oct. 1 Issued a $18,000, 9%, 4-month note to Prime Bank to finance the purchase of a new climbing wall for advanced climbers. The note is due February 1.

Oct. 31 Recorded accrued interest for the Pippen note and the Prime Bank note.

Nov. 1 Issued a $30,000 note and paid $9,400 cash to purchase a vehicle to transport clients to nearby climbing sites as part of a new series of climbing classes. This note bears interest of 6% and matures in 12 months.

Nov. 30 Recorded accrued interest for the Pippen note, the Prime Bank note, and the vehicle note.

Dec. 1 Paid principal and interest on the Pippen note.

Dec. 31 Recorded accrued interest for the Prime Bank note and the vehicle note.

Prepare journal entries for the transactions noted above.