Prepare the appropriate journal entries through the

Reference no: EM13571689

The following selected transactions relate to liabilities of United Insulation Corporation. United's fiscal year ends on December 31.

2013
Jan.13	Negotiated a revolving credit agreement with Parish Bank that can be renewed annually upon bank approval. The amount available under the line of credit is $27.5 million at the bank's prime rate.
Feb.1	Arranged a three-month bank loan of $5.2 million with Parish Bank under the line of credit agreement. Interest at the prime rate of 7% was payable at maturity.
May 1	Paid the 7% note at maturity.
Dec.1	Supported by the credit line, issued $17.3 million of commercial paper on a nine-month note. Interest was discounted at issuance at a 6% discount rate.
31	Recorded any necessary adjusting entry(s).
2014
Sept.1	Paid the commercial paper at maturity.

Required:

Calculate the total interest payable through maturity also calculate the interest payable for the year ended December 31, 2013 and December 31, 2014. (Enter your answers in whole dollars.)

3- month note	Principal	x	Rate		x	Time	=	Interest
total through maturity		x		%	x	3/12	=
9 - Month commercial paper	Principal	x	Rate		x	Time	=	Interest
Total through maturity		x		%	x	9/12	=
2013 Interest		x		%	x	1/12	=
2014 Interest		x		%	x	8/12	=

Prepare the appropriate journal entries through the maturity of each liability. (If no entry is required for a particular transaction, select "No journal entry required" in the first account field. Enter your answers in whole dollars.)

Date	General Journal	Debit	Credit
Jan 13, 2013	No journal entry required
Feb 01, 2013	Cash
	Notes payable
May 01, 2013	Notes Payable
	Interest expense
	Cash
Dec 01, 2013	Cash
	Discount on notes payable
	Notes payable
Dec 31, 2013	Interest expense
	Discount on notes payable

Prepare the appropriate journal entries through the maturity of each liability 2014. (If no entry is required for a particular transaction, select "No journal entry required" in the first account field. Enter your answers in whole dollars.)

Date	General Journal	Debit	Credit
Sep 01, 2014	Interest expense
	Discount on notes payable
Sep 01, 2014	Notes payable
	Cash

Reference no: EM13571689

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