Reference no: EM133045540
Question - Diego Company sells a wide range of goods through two retail stores operating in adjoining cities. Most purchases of goods for resale are on account. Occasionally, a short-term note payable is used to obtain cash for current use. The following transactions were selected from those occurring during 2021:
-On January 10, 2021, purchased merchandise on credit, $36,300; the company uses a perpetual inventory system.
-On March 1, 2021, borrowed $215,000 cash from the bank and signed an interest-bearing note payable at the end of one year, with an annual interest rate of 5 percent payable at maturity.
-On April 5, 2021, sold merchandise on credit, $68,300; this amount included GST of $3,100 and PST of $4,900. The cost of sales represents 80 percent of the sales invoice.
Required -
1. Indicate the accounts affected and the amounts of the financial statement effects of these transactions.
2. What amount of cash is paid on the maturity date of the note?
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