Question

2016

Mar. 1 Borrowed $ 240,000 from Naples Bank. The twelve​-year, 9​% note requires payments due​ annually, on March 1. Each payment consists of $ 20,000 principal plus one​ year's interest.
Dec. 1 Mortgaged the warehouse for $ 400 comma 000 cash with Sage Bank. The mortgage requires monthly payments of $ 5,000. The interest rate on the note is 11​% and accrues monthly. The first payment is due on January​ 1, 2017.
31 Recorded interest accrued on the Sage Bank note.
31 Recorded interest accrued on the Naples Bank note. 2017

Jan. 1 Paid Sage Bank monthly mortgage payment.
Feb. 1 Paid Sage Bank monthly mortgage payment.
Mar. 1 Paid Sage Bank monthly mortgage payment.
1 Paid first installment on note due to Naples Bank.

Required:
Journalize be transactions in me Green Pharmacies general journal.

Answer 1

Green Pharmacies

General journal

Mar. 1:

Debit Cash Account $240,000

Credit Bank 9% Notes Payable (Naples Bank) $240,000

To record the issue of notes payable.

Dec. 1

Debit Warehouse Mortgage $400,000

Credit Warehouse $400,000

To record the transfer of the house to a mortgage bank.

Debit Cash Account $400,000

Credit Mortgage Payable (Sage Bank) $400,000

To record the receipt of cash from the mortgage.

Dec. 31:

Debit Interest on Mortgage Note Expense $3,667

Credit Interest on Mortgage Note Payable $3,667

To record the interest due for the month.

Dec. 31:

Debit Interest on Bank Note Expense $18,000

Credit Interest on Bank Notes Payable $18,000

To accrue interest for 10 months.

Jan. 1:

Debit Mortgage Payable (Sage Bank) $5,000

Debit Interest on Mortgage Note Payable $3,667

Credit Cash Account $8,667

To record monthly repayment plus interest.

Jan. 31:

Debit Interest on Mortgage Note Expense $3,667

Credit Interest on Mortgage Note Payable $3,667

To record the interest due for the month.

Feb. 1:

Debit Mortgage Payable (Sage Bank) $5,000

Debit Interest on Mortgage Note Payable $3,667

Credit Cash Account $8,667

To record monthly repayment plus interest.

Feb 28:

Debit Interest on Bank Note Expense $3,600

Credit Interest on Bank Notes Payable $3,600

To accrue interest for 2 months.

Mar. 1

Debit Mortgage Payable (Sage Bank) $5,000

Debit Interest on Mortgage Note Payable $3,667

Credit Cash Account $8,667

To record monthly repayment plus interest.

Mar. 1:

Debit Notes Payable (Naples Bank) $20,000

Debit Interest on Bank Notes Payable $21,600

Credit Cash Account $41,600

To record the first repayment of principal and interest.

Step-by-step explanation:

Journals are initial records made in an accounting book. It shows the debit and credit aspects of each business transaction.