The following are selected transactions of Deok-moon Group. Deok-moon prepares financial statements quarterly (amounts in thousands). Jan.

Question:

The following are selected transactions of Deok-moon Group. Deok-moon prepares financial statements quarterly (amounts in thousands).

Jan. 2 Purchased merchandise on account from Nan Company, W30,000, terms 2/10, n/30. (Deok-moon uses the perpetual inventory system.)
Feb. 1 Issued a 9%, 2-month, W30,000 note to Nan in payment of account.
Mar. 31 Accrued interest for 2 months on Nan note.
Apr. 1 Paid face value and interest on Nan note.
July 1 Purchased equipment from Ji-yoo Equipment paying W11,000 in cash and signing a 10%, 3-month, W60,000 note.
Sept. 30 Accrued interest for 3 months on Ji-yoo note.
Oct. 1 Paid face value and interest on Ji-yoo note.
Dec. 1 Borrowed W24,000 from the Wonju Bank by issuing a 3-month, 8% note with a face value of W24,000.
Dec. 31 Recognized interest expense for 1 month on Wonju Bank note.

Instructions
a. Prepare journal entries for the listed transactions and events.
b. Post to the accounts Notes Payable, Interest Payable, and Interest Expense.
c. Show the statement of financial position presentation of notes and interest payable at December 31.
d. What is total interest expense for the year?

Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial... Face Value
Face value is a financial term used to describe the nominal or dollar value of a security, as stated by its issuer. For stocks, the face value is the original cost of the stock, as listed on the certificate. For bonds, it is the amount paid to the...

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