Brestovacki Corporation issued a $50,000, five-year, 5% note to Jernigan Corp. on January 1, 2014, and received

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Brestovacki Corporation issued a $50,000, five-year, 5% note to Jernigan Corp. on January 1, 2014, and received a piece of equipment that normally sells for $38,912. The note requires annual interest payments each December 31. The market interest rate for a note of similar risk is 11%. Prepare Brestovacki's journal entry for
(a) The January 1, 2014 issuance and
(b) The December 31, 2014 interest payment using the effective interest method.
Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...
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Intermediate Accounting

ISBN: 978-1118300855

10th Canadian Edition Volume 2

Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Nicola M. Young, Irene M. Wiecek, Bruce J. McConomy

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