May SOF received a bank loan of $ from Conexus Credit Union.
Jun SOF spent $ to purchase a forklift POS for a total cost of
$ The forklift will be used to move groceries throughout the store. The forklift
will have a year useful life.
The interest rate on the loan from Conexus is compounded only on the loan
principle outstanding The loan is for years and will be paid back evenly over years.
As part of the financing SOF only needs to make the required loan payments each year on
Apr Each loan payment will be for $ plus any interest owing.
Required:
a Journal Entries:
Prepare the required journal entries for each of the following dates relating to both
the asset and the loan:
May
Jun
Dec
Apr
Dec
Apr
Dec
Apr
You must show all supporting calculations.
b Financial Statements:
What will the NBV of the equipment be on the Dec statement of financial position?
