October 30, 2016 admin

Notes Payable—Long Term—Ford

Liabilities and Net Worth

NOTES PAYABLE—LONG TERM—FORD	LIABILITY ACCOUNT
	2515

ACCOUNT EXPLANATION
TRANSACTIONS
COMMENTS

ACCOUNT EXPLANATION

Notes payable by the dealership to Ford Motor Company, five (5) years from the date of issue, or immediately upon retirement of all of the Preferred stock of the dealership, whichever occurs first.

TRANSACTIONS

					Jrnl.	Dr.	Cr.

	Promissory note issued by Ford Motor Company				CR
		Cash in Bank—General				1001
			Notes Payable—Ford				2515

	Monthly accrual of note interest				SE
		Interest—Excluding Vehicle & Mortgage				8740
			Accrued Interest				2421

COMMENTS

Subsidiary records should support this account.
Payments of principal amounts are made concurrent with the annual Profit Distribution and are charged to Account 2515 until the long term portion has been paid.
Interest not paid on a monthly basis should be accrued as a debt to Account 8740, Interest—Excluding Vehicle and Mortgage, and a credit to Account 2421, Accrued Interest.