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corporate journal entry states “Borrowed from J.C. Tedford Life
Insurance” in the sum of $90,000. However, the $90,000 transfer
was originally booked as a debit to notes payable and a credit to
preferred stock.
On April 8, 1994, Mr. Tedford signed a document entitled
“Demand Note” on behalf of Border. The demand note is printed on
Border letterhead, made payable to the order of J.C. Tedford in
the principal sum of $15,000, bearing interest at the rate of 6
percent per annum. The space behind “Interest payable,” where
the date interest is payable is to be inserted, is blank. A copy
of a check signed by Mr. Tedford, dated April 8, 1994, is stapled
to the demand note. The check is made payable to the order of
Border and has the word “Loan” written on it in Mr. Tedford’s
handwriting. This transfer of money was entered into Border’s
“Aged Accounts Payable by Vendor.”
On April 15, 1994, Mr. Tedford prepared another demand note
on behalf of Border, in the principal sum of $15,000, bearing
interest at the rate of 6 percent per annum. The space behind
“Interest payable” where the date interest is payable is to be
inserted, is blank. The demand note is unsigned, but attached to
it is a copy of a check dated April 15, 1994, made payable to
Border for $15,000. The check is handwritten and signed by Mr.
Tedford with the word “Loan” written on it.
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Last modified: May 25, 2011