During 2014, Aubergine Co, borrowed cash from Chartreuse Company by issuing notes payable as follows:

1. July 1, 2014, issued an eight months, 4% note for $75000. Interest and principal are payable at maturity.
2. November 1,2014, issue a three month, 5% note for $42000. Interest is payable monthly on the first day of the month. Principal is payable at maturity.

Aubergine has a December 31 fiscal year end and prepares adjusting entries on an annual basis.

Question

During 2014, Aubergine Co, borrowed cash from Chartreuse Company by issuing notes payable as follows: 

1. July 1, 2014, issued an eight months, 4% note for $75000.  Interest and principal are payable at maturity.
2. November 1,2014, issue a three month, 5% note for $42000. Interest is payable monthly on the first day of the month. Principal is payable at maturity.

Aubergine has a December 31 fiscal year end and prepares adjusting entries on an annual basis.

anonymous · Answer

Question: Prepare all necessary journal entries for Aubergine in 2014 and 2015 regarding the notes and interest including adjusting entries. Prepare separate adjusting entries for each note.

*hint* There are 4 entries for each note.

anonymous · Answer

For maturity, there is 3 rows for first note, 4 rows for 2nd note

anonymous · Answer

and then part b: do journal entries for other party but with November 30 as fiscal period end