Prepare journal entries to record repayment of the note

Reference no: EM131912918

Problem

On May 1, Affiliated Tech, a consumer electronics firm, issued a $700,000 face value, 6 month zero-interest bearing note to First BanCorp.
In determining the amount of cash provided to Affiliated Tech, First BanCorp considered the appropriate interest rate to be 12.439%.

Required:

Prepare Affiliated Tech's journal entries to:

(a) record the issuance of the note
(b) amortize the note and accrue periodic interest expense
( c) record repayment of the note.

Reference no: EM131912918

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