On June 30, 2018, Chu Industries Issued 9-Month Notes in the Amount

question 133

Essay

On June 30, 2018, Chu Industries issued 9-month notes in the amount of $700,000. Assume that interest is payable at maturity in the following three independent cases: Determine the amount of interest expense that should be accrued in a year-end adjusting entry under each assumption:

---

Definitions:

Independent

A term used to describe films produced outside of the major film studio system, often characterized by lower budgets and more personal, innovative content.

Blockbuster

Big-budget movie spectacles that have come to dominate studio release slates since 1980. Blockbusters are defined by what they look and sound like and by the endeavor itself—by the amount of cash poured into each production and into advertising and promotion, and then by the astonishing revenues earned at the box office.

Corporate Buyouts

Transactions where a company is purchased outright, typically resulting in significant organizational and operational changes.

Paramount Pictures

One of the major American film studios, founded in 1912, known for producing and distributing a wide array of notable and successful films.