Journalize entries for questions 1-5 1) April 30 , accepted a $10,000, 12%, 30-d
ID: 2380200 • Letter: J
Question
Journalize entries for questions 1-5
1) April 30, accepted a $10,000, 12%, 30-day note dated this day in granting CBS company a time extension on their past-due account.
2) May 30, received payment of maturity value from CBS Company.
3) December 1, accepted a $20,000, 12%, 90 day note dated this day in granting Dave Company a time extension on their past due account.
4) December 31, 2009, record the adjusting entry for accrued interest on the Dave company note received on December 1st.
5) March 1, 2010, received payment of maturity value from Dave Company.
Explanation / Answer
1) April 30, accepted a $10,000, 12%, 30-day note dated this day in granting CBS company a time extension on their past-due account
Debit: Notes receivable 10,000
Credit: Accounts receivable 10,000
2) May 30, received payment of maturity value from CBS Company.
10,000*.12*1/12 = 100
Debit: Cash 10,100
Credit: Notes receivable 10,000
Credit: Interest revenue 100
3) December 1, accepted a $20,000, 12%, 90 day note dated this day in granting Dave Company a time extension on their past due account.
Debit: Notes receivable 20,000
Credit: Accounts receivable 20,000
4) December 31, 2009, record the adjusting entry for accrued interest on the Dave company note received on December 1st.
20,000*.12*1/12 = 200
Debit: Interest receivable 200
Credit: Interest revenue 200
5) March 1, 2010, received payment of maturity value from Dave Company.
Debit: Cash 20,600
Credit: Notes receivable 20,000
Credit: Interest revenue 400
Credit: Interest receivable 200
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