g O bjective 4 P9-33A Accounting for notes receivable, dishonored notes, and acc
ID: 2586723 • Letter: G
Question
g O bjective 4 P9-33A Accounting for notes receivable, dishonored notes, and accrued interest revenue ncome Summary CR $74 Consider the folloving transactions for Cc Pablishing 2018 Dec. 6 Received a $18,000, 90-day, 6% note in settlement of an overdue receivable from Go Go Publishing 31 Made an adjusting entry to accrue interest on the Go Go Publishing note 31 Made a closing entry for interest revenue. 2019 Mar. 6 Collected the maturity value of the Go Go Publishing note. Jun, 30 Loaned $11,000 cash to Lincoln Music, receiving a six-month, 20% note. Received a $2,400, 60-day, 20% note for a sale to Tusk Music. Ignore Cost of Oct. 2 Dec. 1 1 30 Goods Sold. Tusk Music dishonored its note at maturity. Wrote off the receivable associated with Tusk Music. (Use the allowance method) Collected the maturity value of the Lincoln Music note. Journalize all transactions for CC Publishing Round all amounts to the nearest dollax.Explanation / Answer
Date Account Debit credit 2018 Note receivable 18000 Dec 6 Accounts receivable 18000 [Being Note received for accounts due] Dec 31 Interest receivable 75 Interest revenue 75 [Being interest accrued for 25 days [7dec -31dec] .assuming 360 days in a year ;18000*.06*25/360] Dec 31 Interest revenue 75 Income summary 75 [Being interest revenue closed] 2019 mar 6 Cash 18270 Note receivable 18000 Interest receivable 75 Interest revenue [18000*.06*65/360] 195 [Note collected ,interest revenue recognised for 65 days [1jan -6 mar] jun 30 Note receivable 11000 cash 11000 [Being loan given] oct 2 Note receivable 2400 sales revenue 2400 [being sales made] dec 1 Accounts receivable 2480 Interest revenue [2400*.20*60/360] 80 Note receivable 2400 dec 1 Allowance for doubtful account 2480 Accounts receivable 2480 [Being account written off] dec 30 cash 12100 Note receivable 11000 Interest revenue [11000*.20*6/12] 1100 [note collected]
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