1. Record the transactions in a general journal. When required, enter amounts to the nearest cent. If an amount box does not require an entry, leave it blank. Assume 360 days in a year. Marienau Suppliers had the following transactions: Mar. 1 Sold merchandise on account to G. Perez $5,500. 20 G. Perez gave a $5,500, 90-day, 6% note to extend time for payment. 30 G. Perez's note is discounted at Commerce Bank at a discount rate of 8%. Apr. 20 Received a $2,600, 60-day, 6% note from D. Larson in payment for sale of merchandise. May 5 D. Larson's note is discounted at Commerce Bank at a discount rate of 7%. June 19 D. Larson's note is dishonored. The bank bills Marienau for the maturity value of the note plus a $50 bank fee. July 31 D. Larson's dishonored note is collected; Larson pays Marienau the maturity value of the note, the $50 bank fee, and interest at 6% on the maturity value plus the bank fee. Aug. 1 Sold merchandise on account to A. Bauer $5,700. 12 A. Bauer paid $300 and gave a $5,400, 30-day, 5% note to extend time for payment. Sept. 11 A. Bauer paid $500, plus interest, and gave a new $4,900, 60-day, 6 % note to extend time for payment. 26 A. Bauer's note is discounted at Commerce Bank at a discount rate of 7.5%. Nov. 10 A. Bauer's note is dishonored. The bank bills Marienau for the maturity value of the note plus a $50 bank fee. Dec. 15 A. Bauer's dishonored note is collected. Bauer pays Marienau the maturity value of the note, the $50 bank fee, and interest at 6% on the maturity value plus the bank fee.
1. Record the transactions in a general journal. When required, enter amounts to the nearest cent. If an amount box does not require an entry, leave it blank. Assume 360 days in a year. Marienau Suppliers had the following transactions: Mar. 1 Sold merchandise on account to G. Perez $5,500. 20 G. Perez gave a $5,500, 90-day, 6% note to extend time for payment. 30 G. Perez's note is discounted at Commerce Bank at a discount rate of 8%. Apr. 20 Received a $2,600, 60-day, 6% note from D. Larson in payment for sale of merchandise. May 5 D. Larson's note is discounted at Commerce Bank at a discount rate of 7%. June 19 D. Larson's note is dishonored. The bank bills Marienau for the maturity value of the note plus a $50 bank fee. July 31 D. Larson's dishonored note is collected; Larson pays Marienau the maturity value of the note, the $50 bank fee, and interest at 6% on the maturity value plus the bank fee. Aug. 1 Sold merchandise on account to A. Bauer $5,700. 12 A. Bauer paid $300 and gave a $5,400, 30-day, 5% note to extend time for payment. Sept. 11 A. Bauer paid $500, plus interest, and gave a new $4,900, 60-day, 6 % note to extend time for payment. 26 A. Bauer's note is discounted at Commerce Bank at a discount rate of 7.5%. Nov. 10 A. Bauer's note is dishonored. The bank bills Marienau for the maturity value of the note plus a $50 bank fee. Dec. 15 A. Bauer's dishonored note is collected. Bauer pays Marienau the maturity value of the note, the $50 bank fee, and interest at 6% on the maturity value plus the bank fee.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Instructions
Notes Receivable Discounting
1. Record the transactions in a general journal.
When required, enter amounts to the nearest cent. If an amount box does not require an entry, leave it blank. Assume 360 days in a year.
Marienau Suppliers had the following transactions:
Mar. 1 Sold merchandise on account to G. Perez $5,500.
20 G. Perez gave a $5,500, 90-day, 6% note to extend time for payment.
30 G. Perez's note is discounted at Commerce Bank at a discount rate of 8%.
Apr. 20 Received a $2,600, 60-day, 6% note from D. Larson in payment for sale of merchandise.
May 5 D. Larson's note is discounted at Commerce Bank at a discount rate of 7%.
June 19 D. Larson's note is dishonored. The bank bills Marienau for the maturity value of the note plus a $50 bank fee.
July 31 D. Larson's dishonored note is collected; Larson pays Marienau the maturity value of the note, the $50 bank fee, and interest at 6% on the maturity value plus the bank fee.
Aug. 1 Sold merchandise on account to A. Bauer $5,700.
12 A. Bauer paid $300 and gave a $5,400, 30-day, 5% note to extend time for payment.
Sept. 11 A. Bauer paid $500, plus interest, and gave a new $4,900, 60-day, 6% note to extend time for payment.
26 A. Bauer's note is discounted at Commerce Bank at a discount rate of 7.5%.
Nov. 10 A. Bauer's note is dishonored. The bank bills Marienau for the maturity value of the note plus a $50 bank fee.
Dec. 15 A. Bauer's dishonored note is collected. Bauer pays Marienau the maturity value of the note, the $50 bank fee, and interest at 6% on the maturity value plus the bank fee.
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