Tyrell Co. entered into the following transactions involving short-term liabilities. Year 1 Apr. 20 Purchased $38,000 of merchandise on credit from Locust, terms n/30. May 19 Replaced the April 20 account payable to Locust with a 90-day, 8%, $35,000 note payable along with paying $3,000 in cash. July 8 Borrowed $60,000 cash from NBR Bank by signing a 120-day, 11%, $60,000 note payable. __

Solution:

1)Maturity date        

                                             locustNBRfargo    

date of the note             19-May8-Jul28-Nov    

term of note                         90           12060    

maturity date                     17-Aug  5-Nov27-Jan    

2)interest due at maturity      

principal*Rate*time=interest  

locust35,000*8%*90/360=700  

NBR63,000*11%*120/360=2310  

Fargo33,000*7%*60/360=385  

3)Amount in adjusting entry      

33,000*7%*33/360        

= 211.75        

                                 principal*Rate*time=interest

interest to be acccrued33,000*7%*33/360=211.75

4)interest expense to be recorded in 2017      

198        

                                    principal*Rate*time=interest

interest to recorded in 201833,000*7%*27/360=173.25

Journal entries        

DateAccounting titles & ExplanationsDebitCredit  

2016        

20-Apr          inventory    38,000    

                         Accounts payable    38,000  

19-May    Accounts payable  38,000    

                                cash               3,000  

                     notes payable    35,000  

8-Jul                 Cash    63,000    

                         notes payable              63,000  

17-Aug         notes payable  35,000    

                           interest expense               700    

                         cash    35,700  

5-Nov          notes payable  63,000    

                       interest expense                            2,310    

                       cash                                    65,310  

28-Nov            Cash    33,000    

                             notes payable              33,000  

31-Dec    interest expense  211.75    

                       interest payable            211.75  

2017        

27-Jannotes payable  33,000    

                  interest payable  211.75    

               interest expense  173.25    

                       cash                       33,385

answer; customers within the organization

answer; manager working long hours; plz check i believe this is correct good luck;