On December 31, 2011, Sorenson Financing Corporation borrowed $90,000 cash on a $110,300, 24-month zero coupon note.

Question:

On December 31, 2011, Sorenson Financing borrowed $90,000 cash on a $110,300, 24-month zero note. Sorenson uses the straight-line method of amortization.

Required:
1. Record the borrowing in Sorenson’s journal.
2. Prepare the adjusting entry for December 31, 2012.
3. Prepare the entries to recognize the 2013 interest expense and repayment of the note on December 31, 2013. Corporation
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