Midshipmen Company borrows $15,000 from Falcon Company on July 1, 2024. Midshipmen repays the amount borrowed and
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Midshipmen Company borrows $15,000 from Falcon Company on July 1, 2024. Midshipmen repays the amount borrowed and pays interest of 12% (1%/month) on June 30, 2025.
(1) Record the borrowing for Midshipmen on July 1, 2024.
(2) Record the adjusting entry for Midshipmen on December 31, 2024.
(3) Calculate the 2024 year-end adjusted balances of Interest Payable and Interest Expense (assuming the balance of Interest Payable at the beginning of the year is $0).
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