Described below are certain transactions of Lamar Company for 2014:
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1.
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On May 10, the company purchased goods from Fox Company for $75,800, terms 2/10, n/30. Purchases and accounts payable are recorded at net amounts. The invoice was paid on May 18.
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2.
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On June 1, the company purchased equipment for $94,800 from Rao Company, paying $36,000 in cash and giving a one-year, 9% note for the balance.
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3.
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On September 30, the company discounted at 10% its $220,000, one-year zero-interest-bearing note at Virginia State Bank.
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Prepare the adjusting entries necessary at December 31, 2014 in order to properly report interest expense related to the above transactions. Assume straight-line amortization of discounts. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)
Date Account title & Explanation Debit Credit
Dec 31
(To record interest)
Dec 31
(To record amortization from discount)