Merrygold Industrial purchased equipment costing $ 610,000 on September 30, 2021, by paying 10% down and signing a 6%, 6-month note payable for the balance.
Instructions
a) Prepare journal entries to record the purchase of the equipment, the accrual of interest on December 31, and the payment of the note at maturity. Merrygold computes interest based on the number of months outstanding.
b) Determine the balance of any liabilities associated with this transaction as at December 31, 2021.

Question

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The Answer of Merrygold Industrial purchased equipment costing $ 610,000 on September 30, 2021, by paying 10% down and signing a 6%, 6-month note payable for the balance.
Instructions
a) Prepare journal entries to record the purchase of the equipment, the accrual of interest on December 31, and the payment of the note at maturity. Merrygold computes interest based on the number of months outstanding.
b) Determine the balance of any liabilities associated with this transaction as at December 31, 2021.

Merrygold Industrial Purchased Equipment Costing $ 610,000 on September 30