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  3. on october 1, 2021, home builders company issued t

On October 1, 2021, Home Builders Company issued to Carlton Bank a $600,000, 8-month, noninterest-bearing...

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Accounting

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On October 1, 2021, Home Builders Company issued to Carlton Bank a $600,000, 8-month, noninterest-bearing note. Interest was discounted by the bank at a 12% discount rate. Required: 1,3 & 4. Prepare the appropriate journal entry by Home Builders to record the issuance of the note. If the note had been structured as a 12% note with interest and principal payable at maturity, then prepare the appropriate journal entry to record the issuance of the note by Home Builders. Also record the accrual of interest expense on the 12% note for the 2021 financial statements on December 31, 2021. 2. Determine the effective interest rate

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