NOTES RECEIVABLE ENTRIES J. K. Pratt Co. had the following transactions: 20-1 Ju
ID: 2403787 • Letter: N
Question
NOTES RECEIVABLE ENTRIES J. K. Pratt Co. had the following transactions: 20-1 July 20 Received a $750, 30-day, 5% note from J. Akita in payment for sale of merchandise. Aug. 19J Akita paid note issued July 20 plus interest. 25 Sold merchandise on account to L. Beene, $1,100. Sept. 5 L. Beene paid $100 and gave a $1,000, 30-day, 6% note to extend time for payment. Oct. S L. Beene paid note issued September 5, plus interest. 10 Sold merchandise to R. Harris for $750: $50 plus a $700, 30-day, 6% note. 680 681 R. Harris paid $200 plus interest on note issued October 10 and extended the note ($S00) for 30 days. Nov. 9 Dec. 9 R. Harris paid note extended on November 9, plus interest. 10 Sold merchandise on account to B. Kraus, $1,500. B. Kraus paid $150 on merchandise purchased on account, and gave a $1,350, 30- day, 7% note to extend time for payment. 15Explanation / Answer
(Assuming 360 days in a year) Journal Entries (Amounts in $)
Date Accounts and Description Post Ref. Debit Credit July 20 Notes Receivable 750.00 Sales 750.00 Aug. 19 Cash (750.00+3.13) 753.13 Notes Receivable 750.00 Interest Revenue ($750*5%*30/360 days) 3.13 Aug. 25 Accounts Receivable 1,100.00 Sales 1,100.00 Sept. 5 Cash 100.00 Notes Receivable 1,000.00 Accounts Receivable 1,100.00 Oct. 5 Cash 1005.00 Notes Receivable 1,000.00 Interest Revenue ($1,000*6%*30/360) 5.00 Oct. 10 Cash 50.00 Notes Receivable 700.00 Sales 750.00 Nov. 9 Cash (200.00+3.50) 203.50 Notes Receivable 500.00 Notes Receivable 700.00 Interest Revenue ($700*6%*30/360) 3.50 Dec. 9 Cash (500.00+2.50) 502.50 Notes Receivable 500.00 Interest Revenue ($500*6%*30/360) 2.50 Dec. 10 Accounts Receivable 1,500.00 Sales 1,500.00 Dec. 15 Cash 150.00 Notes Receivable 1,350.00 Accounts Receivable 1,500.00 Jan. 14 Accounts Receivable (1,350.00+7.88) 1357.88 Notes Receivable 1,350.00 Interest Revenue (1,350*7%*30/360) 7.88 Feb. 13 Cash (1,357.88+7.87) 1,365.75 Accounts Receivable 1,357.88 Interest Revenue (1,350*7%*30/360) 7.87Related Questions
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