ACC/422 Final Exam

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Question 2

Metlock Family Importers sold goods to Tung Decorators for $45,000 on November 1, 2017, accepting Tung’s $45,000, 6-month, 5% note.

Prepare Metlock’s November 1 entry, December 31 annual adjusting entry, and May 1 entry for the collection of the note and interest. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.)

Date	Account Titles and Explanation	Debit	Credit
				[removed]	[removed]	[removed]
	[removed]	[removed]	[removed]
2/1/18	[removed]	[removed]	[removed]
	[removed]	[removed]	[removed]
	[removed]	[removed]	[removed]
	[removed]	[removed]	[removed]

Question 26

Bridgeport Corporation has elected to use the fair value option for one of its notes payable. The note was issued at an effective rate of 10% and has a carrying value of $15,000. At year-end, Bridgeport’s borrowing rate (credit risk) has declined; the fair value of the note payable is now $16,300.

Determine the unrealized holding gain or loss on the note. (Enter loss using either a negative sign preceding the number e.g. -2,945 or parentheses e.g. (2,945).)

Unrealized Holding Gain or Loss

[removed]

Prepare the entry to record any unrealized holding gain or loss. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)