Cardinals Corporation purchased a computer on December 31, 2013, for $110,775, paying $31,650 down and agreeing to pay the balance in five equal installments of $15,825 payable each December 31 beginning in 2014. An assumed interest rate of 9% is implicit in the purchase price. Prepare the journal entry at the date of purchase (Round answers to 0 decimal places, e.g. 5,275. Credit account titles are automatically indent when amount is entered. Do not indent manually. If no entry is required, select \"No Entry\" for the account titles and enter 0 for the amounts. Round factor values to 5 decimal places, e.g. 1.25124.) Account Titles and Explanation Debit Credit Date December 31, 2013 Equipment Discount on Notes Payable Cash Notes Payable
Solution
Interest Installment Ending year Beginning Payment Payment Amount 0 0 0 -31650 1 61553.732 5539.836 -15825 51268.57 2 51268.568 4614.171 -15825 40057.74 3 40057.739 3605.197 -15825 27837.94 4 27837.936 2505.414 -15825 14518.35 5 14518.35 1306.652 -15825 0 Total 17571.27 -110775 Date Account Titles and explanation Debit Credit 31-Dec-13 Equipment 110775 Discount On notes payable 0 Cash 31650 Notes Payable 61553.73 Date Account Titles and explanation Debit Credit 31-Dec-14 Notes Payable 10285.16 Interest 5539.84 Cash 15825 Date Account Titles and explanation Debit Credit 31-Dec-15 Notes Payable 10285.16 Interest 5539.84 Cash 15825
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Cardinals Corporation purchased a computer on December 31- 2013- for $.docx
1. Cardinals Corporation purchased a computer on December 31, 2013, for $110,775, paying
$31,650 down and agreeing to pay the balance in five equal installments of $15,825 payable each
December 31 beginning in 2014. An assumed interest rate of 9% is implicit in the purchase price.
Prepare the journal entry at the date of purchase (Round answers to 0 decimal places, e.g. 5,275.
Credit account titles are automatically indent when amount is entered. Do not indent manually. If
no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Round
factor values to 5 decimal places, e.g. 1.25124.) Account Titles and Explanation Debit Credit
Date December 31, 2013 Equipment Discount on Notes Payable Cash Notes Payable
Solution
Interest Installment Ending year Beginning Payment Payment Amount 0 0 0 -31650 1 61553.732
5539.836 -15825 51268.57 2 51268.568 4614.171 -15825 40057.74 3 40057.739 3605.197 -
15825 27837.94 4 27837.936 2505.414 -15825 14518.35 5 14518.35 1306.652 -15825 0 Total
17571.27 -110775 Date Account Titles and explanation Debit Credit 31-Dec-13 Equipment
110775 Discount On notes payable 0 Cash 31650 Notes Payable 61553.73 Date Account Titles
and explanation Debit Credit 31-Dec-14 Notes Payable 10285.16 Interest 5539.84 Cash 15825
Date Account Titles and explanation Debit Credit 31-Dec-15 Notes Payable 10285.16 Interest
5539.84 Cash 15825
