Cornerstone Exercise 5-35 (Algorithmic) Notes Receivable Link Communications programs voicemail systems for businesses. For a recent project, they charged $135,000. The customer secured this amount by signing a note bearing 12% interest on February 1, 2019. Required: 1. Prepare the journal entry to record the sale on February 1, 2019. Notes Receivable 135,000 Sales Revenue Record sale Feedback Check My Work 135,000 1. Revenue can be recognized when earned, even if the customer has not paid, as long as collectability is reasonably assured. 2. Determine how much interest Link will receive if the note is repaid on December 1, 2019. Round your answer to the nearest whole dollar. 11,250 X Feedback Check My Work 2. When calculating interest, consider the principal, the annual interest rate and the duration of the note. 3. Prepare Link's journal entry to record the cash received to pay off the note and interest on December 1, 2019. If an amount box does not require an entry, leave it blank. 146,250 X Cash Interest Income Notes Receivable Record collection of note 11,250 X 135,000

Cornerstone Exercise 5-35 (Algorithmic) Notes Receivable Link Communications programs voicemail systems for businesses. For a recent project, they charged $135,000. The customer secured this amount by signing a note bearing 12% interest on February 1, 2019. Required: 1. Prepare the journal entry to record the sale on February 1, 2019. Notes Receivable 135,000 Sales Revenue Record sale Feedback Check My Work 135,000 1. Revenue can be recognized when earned, even if the customer has not paid, as long as collectability is reasonably assured. 2. Determine how much interest Link will receive if the note is repaid on December 1, 2019. Round your answer to the nearest whole dollar. 11,250 X Feedback Check My Work 2. When calculating interest, consider the principal, the annual interest rate and the duration of the note. 3. Prepare Link's journal entry to record the cash received to pay off the note and interest on December 1, 2019. If an amount box does not require an entry, leave it blank. 146,250 X Cash Interest Income Notes Receivable Record collection of note 11,250 X 135,000

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter5: Sales And Receivables

Section: Chapter Questions

Problem 34CE: Notes Receivable Metzler Communications designs and programs a website for a local business. Metzler...

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