Journalize the following transactions in the accounts of Simmons Company: Mar 1

Question

Journalize the following transactions in the accounts of Simmons Company:

Mar 1            Received a $60,000, 60-day, 6% note dated March 1 from Bynum Company on account.

Mar 18            Received a $25,000, 60-day, 9% note dated March 18 from Solo Company on account.

Apr. 30     The note dated March 1 from Bynum Company is dishonored, and the   customer’s account is charged for the note, including interest.

May 17            The note dated March 18 from Solo Company is dishonored, and the customer’s account is charged for the note, including interest.

July 29             Cash is received for the amount due on the dishonored note dated March 1   plus interest for 90 days at 8% on the total amount debited to Bynum    Company on April 30.

Aug. 23                       Wrote off against the allowance account the amount charged to Solo                                                             Company on May 17 for the dishonored note dated March 18.

Explanation / Answer

Dr Cr Mar-01 Notes Receivable 60,000 Accounts Receivable 60,000 Mar-18 Notes Receivable 25,000 Accounts Receivable 25,000 Apr. 30 Accounts Receivable 60,600 Notes Receivable 60,000 Interest Revenue + 60000*2/12*6% 600 May-17 Accounts Receivable 25,375 Notes Receivable 25,000 Interest Revenue 25000*9%*2/12 375 Jul-29 Cash 61,812 Accounts Receivable 60,600 Interest Revenue 60,600 x 8% x 90/360 1,212 Aug. 23 Allowance for Doubtful Accounts 25,375 Accounts Receivable 25,375

Related Questions

Navigate

• Browse (All)
• Browse J
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.