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Prepare the appropriate journal entries for the transactions

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Reference no: EM132840092

Problem - Grossman Products began operations in 2021. The following selected transactions occurred from September 2021 through March 2022. Grossman's fiscal year ends on December 31.

2021:

(a) On September 5, Grossman opened a checking account and negotiated a short-term line of credit of up to $10,000,000 at 10% interest. The company is not required to pay any commitment fees.

(b) On October 1, Grossman borrowed $8,000,000 cash and issued a 5-month promissory note with 10% interest payable at maturity.

(c) Grossman received $3,000 of refundable deposits in December for reusable containers.

(d) Grossman recorded accrued interest.

2022:

(e) Grossman paid the promissory note on the March 1 due date.

(f) Half of the storage containers are returned in March, with the other half expected to be returned over the next 6 months.

Required -

1. Prepare the appropriate journal entries for the 2021 transactions.

2. Prepare the appropriate journal entries for the events occurring in March of 2022.

Reference no: EM132840092

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