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Accounting for Notes Receivable—Honoured and Dishonoured On November 30, 2018, Tucker Products performed computer programming services for Damascus Inc. in exchange for a five-month, $75,000, 10% note receivable. Damascus Inc. paid Tucker the full amount of interest and principal on April 30, 2019. Tucker has a December 31 year-end. Required: 1.  Prepare the necessary entries for Tucker to record the transactions described above. For a compound transaction, if those boxes in which no entry is required, leave the box blank. If required, round amounts to the nearest dollar. 2018, Nov. 30                 (Record adjusting entry for bad debt expense estimate)     2018, Dec. 31                 (Record accrued interest income)     2019, Apr. 30                                 (Record collection of note receivable)     2.  Prepare the journal entry required if the note is dishonoured on April 30, 2019. For those boxes in which no entry is required, leave the box blank. 2019, Apr. 30                         (To record dishonoured note)

Accounting for Notes Receivable—Honoured and Dishonoured On November 30, 2018, Tucker Products performed computer programming services for Damascus Inc. in exchange for a five-month, $75,000, 10% note receivable. Damascus Inc. paid Tucker the full amount of interest and principal on April 30, 2019. Tucker has a December 31 year-end. Required: 1.  Prepare the necessary entries for Tucker to record the transactions described above. For a compound transaction, if those boxes in which no entry is required, leave the box blank. If required, round amounts to the nearest dollar. 2018, Nov. 30                 (Record adjusting entry for bad debt expense estimate)     2018, Dec. 31                 (Record accrued interest income)     2019, Apr. 30                                 (Record collection of note receivable)     2.  Prepare the journal entry required if the note is dishonoured on April 30, 2019. For those boxes in which no entry is required, leave the box blank. 2019, Apr. 30                         (To record dishonoured note)

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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  1. Accounting for Notes Receivable—Honoured and Dishonoured

    On November 30, 2018, Tucker Products performed computer programming services for Damascus Inc. in exchange for a five-month, $75,000, 10% note receivable. Damascus Inc. paid Tucker the full amount of interest and principal on April 30, 2019. Tucker has a December 31 year-end.

    Required:

    1.  Prepare the necessary entries for Tucker to record the transactions described above. For a compound transaction, if those boxes in which no entry is required, leave the box blank. If required, round amounts to the nearest dollar.

    2018, Nov. 30      
           
      (Record adjusting entry for bad debt expense estimate)    
    2018, Dec. 31      
           
      (Record accrued interest income)    
    2019, Apr. 30      
           
           
           
      (Record collection of note receivable)    

    2.  Prepare the journal entry required if the note is dishonoured on April 30, 2019. For those boxes in which no entry is required, leave the box blank.

    2019, Apr. 30      
           
           
      (To record dishonoured note)    
  2.  
 

 

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