Chapter 4
Current Liabilities
200
c) Record the payment of interest and repayment of the note on Oct 1, 2016.
Date
Account Title and Explanation
Debit
Credit
AP-17B (
2
5
6
)
Shawn Clarity owns a consulting firm called Clarity Solutions. Clarity Solutions has a year-end
of December 31. The firm had the following transactions during 2017.
Jan 1 Received $10,000 cash for consulting fees from a client. To date, $5,000 worth of
services have been provided, and the rest will be provided on February 16.
Feb 16 Provided the services outstanding from the January 1 transaction.
Mar 11 Purchased office equipment worth $500, on account.
Apr 1 Purchased new office furniture for $7,000 from JJ Store by issuing a six-month note
with 4% interest. Interest and principal payment is due at maturity.
May 11 Paid $500 cash for the purchase of equipment on March 11.
Jun 12 Received a $600 invoice for repair services, to be paid after 45 days.
Jul 27 Paid cash for the invoice received on June 12.
Sep 30 Recorded any payments and interest accrued related to the notes payable from
April 1.
Oct 19 Received $2,000 cash from a client for consulting services provided.
