Problem $8-2$A $($Algo$)$ Record notes payable and notes receivable $($LO$8-2)$

Precision Castparts, a manufacturer of processed engine parts in the automotive and airline industries, borrows $$39\mathrm{.}6$ million cash

on October $1,2024,$ to provide working capital for anticipated expansion. Precision signs a one$-$year, $7\%$ promissory note to

Midwest Bank under a prearranged short$-$term line of credit. Interest on the note is payable at maturity. Each company has a

December $31$ year$-$end.

Required:

Prepare the journal entries on October $1,2024,$ to record $($a$)$ the notes payable for Precision Castparts and $($b$)$ the notes

receivable for Midwest Bank.

Record the adjusting entry on December $31,2024,$ for $($a$)$ Precision Castparts and $($b$)$ Midwest Bank.

Prepare the journal entries on September $30,2025,$ to record payment of $($a$)$ the notes payable for Precision Castparts and $($b$)$

the notes receivable for Midwest Bank.

Prepare the journal entries on October $1,2024,$ to record $($a$)$ the notes payable for Precision Castparts and $($b$)$ the notes receivable for

Midwest Bank. $($If no entry is required for a transaction$/$event$,$ select $"$No Journal Entry Required" in the first account field. Enter your

answers in dollars, not in millions. For example, $$5\mathrm{.}5$ million should be entered as $5,500,000.)$

$1$ Record the issuance of the note by Precision Castparts.

$2$ Record the acceptance of the note by Midwest Bank.

Record the adjusting entry on December $31,2024,$ for $($a$)$ Precision Castparts and $($b$)$ Midwest Bank. $($Do not round intermediate

calculations. If no entry is required for a transaction$/$event$,$ select $"$No Journal Entry Required" in the first account field. Enter your

answers in dollars, not in millions. For example, $$5\mathrm{.}5$ million should be entered as $5,500,000.)$

$1$ Record the adjusting entry for interest for Precision

Castparts.

$2$ Record the adjusting entry for interest for Midwest Bank.

Prepare the journal entries on September $30,2025,$ to record payment of $($a$)$ the notes payable for Precision Castparts and $($b$)$ the notes

receivable for Midwest Bank. $($Do not round intermediate calculations. If no entry is required for a transaction$/$event$,$ select $"$No Journal

Entry Required" in the first account field. Enter your answers in dollars, not in millions. For example, $$5\mathrm{.}5$ million should be entered as

$5,500,000.)$

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$1$ Record the repayment of the note and payment of

interest at maturity for Precision Castparts.

$2$ Record the receipt of cash at maturity for Midwest Bank.