On July 1, 2017, Morningside Co

question 84

Essay

On July 1, 2017, Morningside Co. borrowed $33,000 from the bank. Morningside signed a ten-month, 6% promissory note for the entire amount. Morningside uses a calendar year-end.

Required
1. Analyze the impact on the accounting equation of the journal entry on July 1, 2017, to record the issuance of the promissory note.
2. Analyze the impact of adjusting entries needed at year-end.
3. Analyze the impact of the journal entry on May 1, 2018, to record the payment of principal and interest.

Explain the importance of the cost of labor and other inputs in decision-making processes of firms.

Understand the calculation and interpretation of direct labor and material variances.

Analyze efficiency and price variances for direct labor and materials.

Evaluate the impact of production variances on financial performance.

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Definitions:

Firm Offer

A proposal in contract law that explicitly states it will remain open for a specified period of time and cannot be revoked during that period.

UCC

This code, known as the Uniform Commercial Code, is an extensive assortment of legal rules that supervise commercial exchanges in the United States.

Common Law

A legal system characterized by case law and legal precedents established by court decisions, as opposed to statutory laws enacted by governmental bodies.

Consideration

The benefit, interest, right, or profit that induces a party to enter into a contract; a fundamental component of a valid contract.