Journalize the following entries on the books of the borrower and creditor. Label accordingly. (Assume a 360-day year is used for interest calculations.)
Definitions:
Production Functions
a mathematical relationship expressing the output that can be produced by a firm or economy from different combinations of factor inputs.
Resale of Goods
The act of selling previously purchased products, often used, to another party.
Price-Inelastic
Describes a situation where the demand for a product does not significantly change with a change in its price.
Price-Elastic
A characteristic of a good or service that indicates the demand for it changes significantly when its price changes.
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