Orange Mfg. Co. issued a four-year non-interest-bearing note with a face value of $500,000. Orange received $329,365, resulting in an effective 11% interest rate.
Required:
Prepare journal entries to:
a.Issue the note
b.Record interest at the end of the first year
c.Record interest at the end of the second year
(Note: round all answers to the nearest dollar.)

Question

Orange Mfg. Co. issued a four-year non-interest-bearing note with a face value of $500,000. Orange received $329,365, resulting in an effective 11% interest rate.
Required:
Prepare journal entries to: 
a.Issue the note
b.Record interest at the end of the first year
c.Record interest at the end of the second year
(Note: round all answers to the nearest dollar.)

Quizplus · Accepted Answer

The Answer of Orange Mfg. Co. issued a four-year non-interest-bearing note with a face value of $500,000. Orange received $329,365, resulting in an effective 11% interest rate.
Required:
Prepare journal entries to: 
a.Issue the note
b.Record interest at the end of the first year
c.Record interest at the end of the second year
(Note: round all answers to the nearest dollar.)