E8-12 Recording Note Receivable Transactions, Including Accrual Adjustment for I
ID: 2526371 • Letter: E
Question
E8-12 Recording Note Receivable Transactions, Including Accrual Adjustment for Interest [LO 8-3] To attract retailers to its shopping center, the Marketplace Mall will lend money to tenants under formal contracts, provided that they use it to renovate their store space. On November 1, 2014, the company loaned $106,000 to a new tenant on a one-year note with a stated annual interest rate of 9 percent. Interest is to be received by Marketplace Mall on April 30, 2015, and at maturity on October 31, 2015. Required: Prepare journal entries that Marketplace Mall would record related to this note on the following dates: (a) November 1, 2014; b)December 31, 2014 (Marketplace Mall's fiscal year-end); (c) April 30, 2015; and (d) October 31, 2015. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) View transaction list Journal entry worksheet 2 3 4 Record the receipt of a note on November 1, 2014 for a $106,000 loan to a new tenant. Note: Enter debits before credits. Date General Journal Debit Credit Nov 01, 2014Explanation / Answer
Answers
Date
General Journal
Debit
Credit
01-Nov-14
Notes receivables
$ 1,06,000.00
Cash
$ 1,06,000.00
(notes received for loan given)
31-Dec-14
Interest receivable [$106000 x 9% x 2/12]1
$ 1,590.00
Interest Revenue [$106000 x 9% x 2/12]
$ 1,590.00
(interest revenue accrued for 2 months-Nov and Dec)
30-Apr-15
Cash
$ 4,770.00
Interest Revenue [$106000 x 9% x 4/12]
$ 3,180.00
Interest Receivable [$106000 x 9% x 2/12]1
$ 1,590.00
(Interest received for 6 months - 1 Nov to 30 April)
31-Oct-15
Cash
$ 1,10,770.00
Notes Receivables
$ 1,06,000.00
Interest Revenue [$106000 x 9% x 6/12]
$ 4,770.00
(amount of note received along with 6 months interest)
Date
General Journal
Debit
Credit
01-Nov-14
Notes receivables
$ 1,06,000.00
Cash
$ 1,06,000.00
(notes received for loan given)
31-Dec-14
Interest receivable [$106000 x 9% x 2/12]1
$ 1,590.00
Interest Revenue [$106000 x 9% x 2/12]
$ 1,590.00
(interest revenue accrued for 2 months-Nov and Dec)
30-Apr-15
Cash
$ 4,770.00
Interest Revenue [$106000 x 9% x 4/12]
$ 3,180.00
Interest Receivable [$106000 x 9% x 2/12]1
$ 1,590.00
(Interest received for 6 months - 1 Nov to 30 April)
31-Oct-15
Cash
$ 1,10,770.00
Notes Receivables
$ 1,06,000.00
Interest Revenue [$106000 x 9% x 6/12]
$ 4,770.00
(amount of note received along with 6 months interest)
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