On November 1,2012,Bob's Skateboards Store Signed a $12,000,3-Month,5% Note Payable

question 164

Essay

On November 1,2012,Bob's Skateboards Store signed a $12,000,3-month,5% note payable to cover a past due account payable.This company uses a calendar year to report financial activity and updates the accounting records monthly.
a.What amount of total interest will the company pay on this note?
b.Prepare Bob's general journal entry to record the issuance of the note payable.
c.Prepare Bob's general journal entry to record the payment of the note on February 1,2013.

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Definitions:

Surveillance Strategy

A plan or approach designed to systematically monitor activities or behaviors, often for the purpose of gathering information, ensuring security, or enforcing policies.

Representativeness Heuristic

A cognitive shortcut where the likelihood of something is judged based on how similar it is to a typical case.

Confirmation Bias

The propensity to seek out, interpret, prefer, and remember data in a manner that validates one's already established beliefs or theories.

Mental Set

A tendency to approach a problem in one particular way, often a way that has been successful in the past.