xercise 7.14 (Algo) Notes and Interest (LO7-7) n August 1, year 1, Hampton Construction received a 4.5 percent, 6-month note receivable from Dusty Roads, one of Hampton onstruction's problem credit customers. Roads had owed $44,900 on an outstanding account receivable. The note receivable was ken in settlement of this amount. Assume that Hampton Construction makes adjusting entries for accrued interest revenue once ach year on December 31. Record the receipt of the note on August 1 in settlement of the account receivable. Record accrued interest at December 31, year 1. Assume that Dusty Roads pays the note plus accrued interest in full. Record the collection of the principal and interest on January 31, year 2. Assume that Dusty Roads did not make the necessary principal and interest payment on January 31, year 2. Rather, assume that he defaulted on his obligation. Record the default on January 31, year 2. Journalize the above four events on the books of Hampton Construction. Indicate the effects of each of the four transactions journalized in part a on the elements of the financial statement shown below. se the code letters I for increase, D for decrease, and NE for no effect. Complete this question by entering your answers in the tabs below. Required A Required B Journalize the above four events on the books of Hampton Construction. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations and round your final answers to the nearest dollar amount.) View transaction list Journal entry worksheet < 1 2 3 4 Record the entry to accept a six-month, 4.5% note receivable in settlement of an account receivable on August 1. Note: Enter debits before credits. Date Aug. 1 Record entry General Journal Clear entry < Required A Debit credit View general Journal Required B >
xercise 7.14 (Algo) Notes and Interest (LO7-7) n August 1, year 1, Hampton Construction received a 4.5 percent, 6-month note receivable from Dusty Roads, one of Hampton onstruction's problem credit customers. Roads had owed $44,900 on an outstanding account receivable. The note receivable was ken in settlement of this amount. Assume that Hampton Construction makes adjusting entries for accrued interest revenue once ach year on December 31. Record the receipt of the note on August 1 in settlement of the account receivable. Record accrued interest at December 31, year 1. Assume that Dusty Roads pays the note plus accrued interest in full. Record the collection of the principal and interest on January 31, year 2. Assume that Dusty Roads did not make the necessary principal and interest payment on January 31, year 2. Rather, assume that he defaulted on his obligation. Record the default on January 31, year 2. Journalize the above four events on the books of Hampton Construction. Indicate the effects of each of the four transactions journalized in part a on the elements of the financial statement shown below. se the code letters I for increase, D for decrease, and NE for no effect. Complete this question by entering your answers in the tabs below. Required A Required B Journalize the above four events on the books of Hampton Construction. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations and round your final answers to the nearest dollar amount.) View transaction list Journal entry worksheet < 1 2 3 4 Record the entry to accept a six-month, 4.5% note receivable in settlement of an account receivable on August 1. Note: Enter debits before credits. Date Aug. 1 Record entry General Journal Clear entry < Required A Debit credit View general Journal Required B >
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Transcribed Image Text:xercise 7.14 (Algo) Notes and Interest (LO7-7)
n August 1, year 1, Hampton Construction received a 4.5 percent, 6-month note receivable from Dusty Roads, one of Hampton
onstruction's problem credit customers. Roads had owed $44,900 on an outstanding account receivable. The note receivable was
ken in settlement of this amount. Assume that Hampton Construction makes adjusting entries for accrued interest revenue once
ach year on December 31.
Record the receipt of the note on August 1 in settlement of the account receivable.
Record accrued interest at December 31, year 1.
Assume that Dusty Roads pays the note plus accrued interest in full. Record the collection of the principal and interest on January
31, year 2.
Assume that Dusty Roads did not make the necessary principal and interest payment on January 31, year 2. Rather, assume that he
defaulted on his obligation. Record the default on January 31, year 2.
Journalize the above four events on the books of Hampton Construction.
Indicate the effects of each of the four transactions journalized in part a on the elements of the financial statement shown below.
se the code letters I for increase, D for decrease, and NE for no effect.
Complete this question by entering your answers in the tabs below.
Required A
Required B
Journalize the above four events on the books of Hampton Construction. (If no entry is required for a transaction/event, select "No
journal entry required" in the first account field. Do not round intermediate calculations and round your final answers to the nearest
dollar amount.)
View transaction list
Journal entry worksheet
23
1
Record the entry to accept a six-month, 4.5% note receivable in settlement of
an account receivable on August 1.
Note: Enter debits before credits.
Date
Aug. 1
4
Record entry
General Journal
Clear entry
< Required A
Debit
credit
View general Journal
Required B >
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