a. Prepare a bank reconciliation for June 30 b. Prepare any adjusting entries ne

Question

a. Prepare a bank reconciliation for June 30 b. Prepare any adjusting entries necessary as a result of the bank reconciliation PROBLEM #2: Prepare journal entries to record the following transactions entered into by the Merando Company: 2011 June 1 Received a $9,000, 6%, 1-year note from Dan Gore as full payment on his account Nov. 1 Sold merchandise on account to Barlow, Inc., for $12,000, terms 2/10, n/30 Nov. 5 Barlow, Inc., returned merchandise worth $1,000. Nov. 9 Received payment in full from Barlow, Inc. Dec. 31 Accrued interest on Gore's note. 2012 June 1 Dan Gore honored his promissory note by sending the face amount plus interest

Explanation / Answer

Solution:

Preparing Journal Entries to record the following Transactions:

Interest Revenue

($9,000 * 6% * 7 /12 = $315)

Date General Journal Debit Credit June 1, 2011 6% Note Receivable $9,000 Accounts Receivable - Dan Gore $9,000 (To Record Note receivable received as a full payment on account) Nov 1, 2011 Accounts Receivable - Barlow Inc. $12,000 Sales $12,000 (To Record the sales on account) Nov 1, 2011 Sales Return and Allowances $1,000 Accounts Receivable - Barlow Inc. $1,000 (To Record the sales return and allowances) Nov 9, 2011 Cash $10,780 Sales Discounts ($11,000 *2%) $220 Accounts Receivable - Barlow Inc. $11,000 (To Record the full payment of balance) Dec 31, 2011 Interest Receivable $315

Interest Revenue

($9,000 * 6% * 7 /12 = $315)

$315 (To Record the Interest accrued on note for 7 months) June 1, 2012 Cash $9,540 Note Receivable $9,000 Interest Receivable $315 Interest Revenue $225 ($9,000 * 6% * 5 /12 = $225) (To Record the maturity of note receivable)

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