a. Compute the amount of Interest that Colson will pay on the line of credit for the first four months of Year 1. Note: Do not round Intermediate calculations. Round your final answers to the nearest whole dollar.
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- On December 1 of the current year, Jordan Inc. assigns 125,000 of its accounts receivable to McLaughlin Company for cash. McLaughlin Company charges a 750 service fee, advances 85% of Jordans accounts receivable, and charges an annual interest rate of 9% on any outstanding loan balance. Prepare the related journal entries for Jordan.If Bergen Air Systems takes out a $100,000 loan, with eight equal principal payments due over the next eight years, how much will be accounted for as a current portion of a noncurrent note payable each year?Halep Inc. borrowed $30,000 from Davis Bank and signed a 4-year note payable stating the interest rate was 4% compounded annually. Halep Inc. will make payments of $8,264.70 at the end of each year. Prepare an amortization table showing the principal and interest in each payment.
- Colson Company has a line of credit with Federal Bank. Colson can borrow up to $362,500 at any time over the course of the Year 1 calendar year. The following table shows the prime rate expressed as an annual percentage, along with the amounts borrowed and repaid during the first four months of Year 1. Colson agreed to pay Interest at an annual rate equal to 1.50 percent above the bank's prime rate. Funds are borrowed or repaid on the first day of each month. Interest is payable in cash on the last day of the month. The Interest rate is applied to the outstanding monthly balance. For example, Colson pays 6.00 percent (4.50 percent +1.50 percent) annual Interest on $78,000 for the month of January. Prime Rate Amount Borrowed or (Repaid) for the Month January February Month $ 78,000 4.50% 119,500 3.50 (15,400) 26,800 4.00 4.50 March April Required: a. Compute the amount of Interest that Colson will pay on the line of credit for the first four months of Year 1. Note: Do not round…Colson Company has a line of credit with Federal Bank. Colson can borrow up to $436,000 at any time over the course of the calendar year. The following table shows the prime rate expressed as an annual percentage along with the amounts borrowed and repaid during the first four months of the year. Colson agreed to pay interest at an annual rate equal to 2.00 percent above the bank's prime rate. Funds are borrowed or repaid on the first day of each month. Interest is payable in cash on the last day of the month. The interest rate is applied to the outstanding monthly balance. For example, Colson pays 6.25 percent (4.25 percent +2.00 percent) annual interest on $77,700 for the month of January. Amount Borrowed Prime Rate for the Month Month January February March April or (Repaid) $ 77,700 4.25% 120,700 (16,500) 28,400 3.25 3.75 4.25 Required a. Compute the amount of interest that Colson will pay on the line of credit for the first four months of the year. b. Compute the amount of…Bridgeport Company has a line of credit with National Bank. Bridgeport can borrow up to $1,040,000 at any time over the course of the Year 1 calendar year. The following table shows the prime rate expressed as an annual percentage, along with the amounts borrowed and repaid during the first two months of Year 1. Bridgeport agreed to pay interest at an annual rate equal to 1 percent above the bank's prime rate. Funds are borrowed or repaid on the first day of each month. Interest is payable in cash on the last day of the month. The interest rate is applied to the outstanding monthly balance. For example, Bridgeport pays 4 percent (3 percent + 1 percent) annual interest on $154,800 for the month of January. Month January February Month Amount borrowed or (repaid) January February $154,800 (31,600) Required: Compute the amount of (a) interest paid and (b) Bridgeport's liability balance at the end of each of the first two months. Prime rate for the (a) Interest Paid month 3% 3.5% (b)…
- Boyd Company has a line of credit with State Bank. Boyd can borrow up to $520,000 at any time over the course of the Year 1 calendar year. The following table shows the prime rate expressed as an annual percentage along with the amounts borrowed and repaid during Year 1. Boyd agreed to pay interest at an annual rate equal to 1 percent above the bank’s prime rate. Funds are borrowed or repaid on the first day of each month. Interest is payable in cash on the last day of the month. The interest rate is applied to the outstanding monthly balance. For example, Boyd pays 6 percent (5 percent + 1 percent) annual interest on $72,000 for the month of January. Month Amount Borrowed or (Repaid) Prime Rate for the Month January $ 72,000 5% February 52,000 5 March (46,000) 6 April through October No change No change November (36,000) 6 December (22,000) 5 Boyd earned $37,000 of cash revenue during Year 1.Required Prepare an income statement, balance sheetand statement of cash…Colson Company has a line of credit with Federal Bank. Colson can borrow up to $315,500 at any time over the course of the calendar year. The following table shows the prime rate expressed as an annual percentage along with the amounts borrowed and repaid during the first four months of the year. Colson agreed to pay interest at an annual rate equal to 2.00 percent above the bank's prime rate. Funds are borrowed or repaid on the first day of each month. Interest is payable in cash on the last day of the month. The interest rate is applied to the outstanding monthly balance. For example, Colson pays 6.25 percent (4.25 percent + 2.00 percent) annual interest on $76.000 for the month of January. Month January February March April Amount Borroed or (Repaid) $ 76,000 121,200 (20,900) 27,500 Prime Rate for the Month 4.25% 3.25 3.75 4.25 Required a. Compute the amount of interest that Colson will pay on the line of credit for the first four months of the year. b. Compute the amount of…Boyd Company has a line of credit with State Bank. Boyd can borrow up to $500,000 at any time over the course of the Year 1 calendar year. The following table shows the prime rate expressed as an annual percentage along with the amounts borrowed and repaid during Year 1. Boyd agreed to pay interest at an annual rate equal to 1 percent above the bank's prime rate. Funds are borrowed or repaid on the first day of each month, Interest is payable in cash on the last day of the month. The interest rate is applied to the outstanding monthly balance. For example, Boyd pays 6 percent (5 percent +1 percent) annual interest on $70,000 for the month of January. Amount Borrowed or (Repaid) $ 70,000 50,000 (42,000) No change (30,000) (20,000) Boyd earned $35,000 of cash revenue during Year 1. Month January February March April through October November December Income Statement Required Prepare an income statement, balance sheet, and statement of cash flows for Year 1. Service revenue Expenses…
- Colson Company has a line of credit with Federal Bank, Colson can borrow up to $386,000 at any time over the course of the calendar year. The following table shows the prime rate expressed as an annual percentage along with the amounts borrowed and repaid during the first four months of the year. Colson agreed to pay interest at an annual rate equal to 2.50 percent above the bank's prime rate. Funds are borrowed or repaid on the first day of each month. Interest is payable in cash on the last day of the month. The interest rate is applied to the outstanding monthly balance. For example, Colson pays 6.25 percent (3.75 percent + 2.50 percent) annual interest on $81,000 for the month of January. Month January February March April Amount Borrowed or (Repaid). $ 81,000 117,900 (24,400) 27,600 Required a. Compute the amount of interest that Colson will pay on the line of credit for the first four months of the year. b. Compute the amount of Colson's liability at the end of each of the first…Singer Company has a line of credit with United Bank. Singer can borrow up to $400,000 at any time over the course of the Year 1 calendar year. The following table shows the prime rate expressed as an annual percentage along with the amounts borrowed and repaid during the first three months of Year 1. Singer agreed to pay interest at an annual rate equal to 2 percent above the bank’s prime rate. Funds are borrowed or repaid on the first day of each month. Interest is payable in cash on the last day of the month. The interest rate is applied to the outstanding monthly balance. For example, Singer pays 6.5 percent (4.5 percent + 2 percent) annual interest on $140,000 for the month of February. Month Amount Borrowed or (Repaid) Prime Rate for the Month January $80,000 4.0% February 60,000 4.5 March (20,000) 4.0 Required Provide all journal entries pertaining to Singer’s line of credit for the first three months of Year 1.Colson Company has a line of credit with Federal Bank. Colson can borrow up to $800,000 at any time over the course of the calendar year. The following table shows the prime rate expressed as an annual percentage along with the amounts borrowed and repaid during the first four months of the year. Colson agreed to pay interest at an annual rate equal to 2 percent above the bank's prime rate. Funds are borrowed or repaid on the first day of each month. Interest is payable in cash on the last day of the month. The interest rate is applied to the outstanding monthly balance. For example, Colson pays 6 percent (4 percent + 2 percent) annual interest on $80,000 for the month of January. Month January February March April Amount Borrowed or (Repaid) $ 80,000 50,000 (30,000) 20,000 Required a. Compute the amount of interest that Colson will pay on the line of credit for the first four months of the year. b. Compute the amount of Colson's liability at the end of each of the first four months.…