Tardif Corporation adjusts its books monthly. On September 30, 2015, notes recei

Question

Tardif Corporation adjusts its books monthly. On September 30, 2015, notes receivable include the following: Term Issue Date MakerPrincipal Interest Mar. 31, 2015 RES Inc. May 31, 2015 Ihara Ltd. $15,000 5% 7months 16,000 3% 18months Aug. 31, 2015 Dragon Limited 4,500 S% 2months 19,000 4% 16 months Sept. 30, 2015 MGH Corp. Interest is due at maturity for the RES and Dragon notes. Interest is due on the first day of the month for the Ihara and MGH notes. At September 30, the balance in the Allowance for Doubtful Notes account is nil. In October, the following selected transactions were completed. Oct. 1 Received the interest due from thara and MGH Received notice that Dragon was unable to pay its note as scheduled. It expects to be able to pay in 31 the future. 31 The RES note matured and was received in full. 31 Accrued interest on the Ihara and MGH notes. 31 Analyzed the remaining notes for collectibility. Estimated that $16,000 of notes may not be collectible in the future because of significant labour issues currently being expenienced by Ihara. Your answer is partially correct. fiv again. Calculate the balance in the Interest Receivable and Notes Receivable accounts at September 30, 2015. (Round answers to O decimal places, e.g. 5,275.) Balance in the Interest Receivable s54 Balance in the Notes Receivable 8 BA (Part Level Debit Credit Date Account Titles and Explanation Oct Cast 31 Interest Receiv 5.500 nterest Reven (To record dishonoured note; eventual collection (Tto recard aolection of note and interest) Oct 31

Explanation / Answer

(a) Balance in the Interest Receivable: $434

Balance in the Notes Receivable: $54500

(b)

(c)

Issue Date Maker Principal Interest Term Interest Receivable on Sept. 30, 2015 Mar. 31, 2015 RES Inc. 15000 5% 7 months 375 ($15000 x 5% x 6/12) May. 31, 2015 Ihara Ltd. 16000 3% 18 months 40 ($16000 x 3% x 1/12) Aug. 31, 2015 Dragon Limited 4500 5% 2 months 18.75 ($4500 x 5% x 1/12) Sept. 30, 2015 MGH Corp. 19000 4% 16 months 0 54500 433.75

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