Prepare Journal Entries for the Following Transactions for Design Imports

question 77

Essay

Prepare journal entries for the following transactions for Design Imports.
a) Purchased $7,800 of merchandise (perpetual inventory method) from Serial Material Company on account.
b) Gave Serial Material Company a 120-day, 5% note in settlement of the account payable.
c) Design Imports defaulted on its note on the maturity date.
d) Design Imports paid the previously defaulted note plus $115 additional interest.

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