Chapter 4
Current Liabilities
171
AP-9A (
6
)
Darren Spoon from Carding Company signed a 7% half-year note payable for $100,000 on
November 1, 2017. The note is due with interest on May 1, 2018. Carding Company has a year-
end of December 31. Prepare the journal entry for Carding Company for the following.
Required
a) Record the receipt of cash
b) Record accruing interest at the year-end
c) Record ultimate payment of the note in the new year
Date
Account Title and Explanation
Debit
Credit
AP-10A (
5
)
The local transit company, in co-operation with local colleges and universities sells transit
passes for the semester for $200 each. The passes are only sold prior to the start of the
semester, and for the fall semester are good from September 1 to December 31. The transit
company sold 1,000 passes on August 1, 2017.
