the following are selected 2014 transactions ofSean Astin Corporation.
Sept. 1 – Purchased inventory from EncinoCompany on account for $54100. Astin recordspurchases gross and uses a periodic inventorysystem.
Oct. 1 – Issued a $54100, 12-month, 8% note toEncino in payment of account.
Oct. 1 – Borrowed $82220 from the Shore Bankby signing a 12-month, zero-interest-bearing$88240 note.Prepare journal entries
Answer
| Date | Accounting Title & Explanation | Debit | Credit |
| 1-Sep | Purchases | 54,100 | |
| Accounts Payable | 54,100 | ||
| ( Being the entry for purchase of goods) |
|||
| 1-Oct | Accounts Payable | 54,100 | |
| Notes Payable | 54,100 | ||
| ( Being the entry for the payment) | |||
| 1-Oct | Cash | 82220 | |
| Discount on Notes Payable | 6120 | ||
| Notes Payable | 88340 | ||
| ( Being the entry of the bank borrowing) |
