Every month, Glacier Distributors orders shipping supplies from a particular vendor. On February 13, 2019, the company orders supplies amounting to $21,000 on account, payable on March 15, 2019. Due to an unexpected decline in business, the company is unable to pay its vendor on March 15th, and so asked for a payment extension. The vendor granted the extension but requires the company to sign a note that specifies 7.5% interest beginning March 15, 2019, with a due date of July 15, 2019. The company pays the amount in full on July 15, 2019.

Prepare the necessary journal entries for Glacier Distributors on February 13th, March 15th, and July 15th.

Question

Every month, Glacier Distributors orders shipping supplies from a particular vendor. On February 13, 2019, the company orders supplies amounting to $21,000 on account, payable on March 15, 2019. Due to an unexpected decline in business, the company is unable to pay its vendor on March 15th, and so asked for a payment extension. The vendor granted the extension but requires the company to sign a note that specifies 7.5% interest beginning March 15, 2019, with a due date of July 15, 2019. The company pays the amount in full on July 15, 2019.
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Prepare the necessary journal entries for Glacier Distributors on February 13th, March 15th, and July 15th.

Quizplus · Accepted Answer

The Answer of Every month, Glacier Distributors orders shipping supplies from a particular vendor. On February 13, 2019, the company orders supplies amounting to $21,000 on account, payable on March 15, 2019. Due to an unexpected decline in business, the company is unable to pay its vendor on March 15th, and so asked for a payment extension. The vendor granted the extension but requires the company to sign a note that specifies 7.5% interest beginning March 15, 2019, with a due date of July 15, 2019. The company pays the amount in full on July 15, 2019.
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Prepare the necessary journal entries for Glacier Distributors on February 13th, March 15th, and July 15th.

Every Month, Glacier Distributors Orders Shipping Supplies from a Particular