Answered: Chocolate Corner Company had the…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Chocolate Corner Company had the following transactions during the current year:

Apr. 8. Received a $7,050, 75-day, 8% note from Lance Armstrong in payment of account.
May 24. Wrote off customer Joe Nutella's account against the Allowance for Uncollectible Accounts, $150
June 22. Received payment of Lance Armstrong's note in full.
Sept. 10. Gave a $5,600, 90-day, 9% note to Herbert Anson in payment of account.
Sept.18. Received payment of Joe Nutella's account, written off May 24.
Dec 9. Paid principal and interest due on note to Herbert Anson.

Please Note: a 360-day year is standard for many such interest computations - for this course interest is to the nearest month rather than precisely to the day. Round interest to the nearest dollar (no cents).

If needed record the above transactions in general journal form.

On Dec 9^th cash is paid in the amount of:

Multiple Choice

a. $5,726

b. $5,446

c. $5,474 (**incorrect)

d. None of the other alternatives are correct

e. $5,754

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