On January 1, 2014, Oswalt Company had Accounts Receivable of $69,400 and Allowa
ID: 2418015 • Letter: O
Question
On January 1, 2014, Oswalt Company had Accounts Receivable of $69,400 and Allowance for Doubtful Accounts of $4,100. Oswalt Company prepares financial statements annually. During the year, the following selected transactions occurred.
1. Jan. 5 Sold $5,300 of merchandise to Ross Company, terms n/30.
2. Feb. 2 Accepted a $5,300, 4-month, 9% promissory note from Ross Company for balance due.
3. 12 Sold $16,600 of merchandise to Cano Company and accepted Cano’s $16,600, 2-month, 13% note for the balance due.
4. 26 Sold $5,400 of merchandise to Meachum Co., terms n/10.
5. Apr. 5 Accepted a $5,400, 3-month, 7% note from Meachum Co. for balance due.
6. 12 Collected Cano Company note in full.
7. June 2 Collected Ross Company note in full.
8. 15 Sold $3,500 of merchandise to Glanvile Inc. and accepted a $3,500, 6-month, 11% note for the amount due.
Journalize the transactions. (Round answers to 0 decimal places, e.g. 825. Credit account titles are automatically indented when amount is entered. Do not indent manually.)
Explanation / Answer
Jan. 5 Sold $5,300 of merchandise to Ross Company, terms n/30
Dr Accounts receivable (AR) $5300
Cr Sales $5300
Feb. 2 Accepted a $5,300, 4-month, 9% promissory note from Ross Company for balance due
Dr Notes receivable (NR) $5300
Cr AR $5300
Feb. 12 Sold $16,600 of merchandise to Cano Company and accepted Cano’s $16,600, 2-month, 13% note for the balance due.
Dr NR $16600
Cr Sales $16600
Feb. 26 Sold $5,400 of merchandise to Meachum Co., terms n/10
Dr AR $5400
Cr Sales $5400
Apr. 5 Accepted a $5,400, 3-month, 7% note from Meachum Co. for balance due
Dr NR $5400
Cr AR $5400
Apr. 12 Collected Cano Company note in full
Dr Cash $16960
Cr NR $16600
Cr Interest revenue $360 ($16600 x 13% x 2/12)
June 2 Collected Ross Company note in full.
Dr Cash $5459
Cr NR $5300
Cr Interest revenue $159 ($5300 x 9% x 4/12)
June 15 Sold $3,500 of merchandise to Glanvile Inc. and accepted a $3,500, 6-month, 11% note for the amount due
Dr NR $3500
Cr Sales $3500
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