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24 August, 01:31

On September 1, 2017, Banner Co. borrowed $70,000 from the City Bank for five months at 9%. Interest was properly accrued on December 31, 2017. What entry is needed to record the payment of the note and accrued interest on the due date?

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  1. 24 August, 01:54
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    Explanation: Journal Entry

    Loan Borrowed is $70,000

    Interest rate is 9%

    Interest accrued = 70,000 * 9% = 6,300

    1. Cr: Bank $76,300

    Dr: Short Term Loan $70,000

    Dr: Accrued Int on loan $6,300

    Being loan repayment with accrued interest on loan for 5 months.
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