College Accounting (Book Only): A Career Approach
12th Edition
ISBN: 9781305084087
Author: Cathy J. Scott
Publisher: Cengage Learning
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Chapter D, Problem 4P
a.
To determine
Journalize the issuance of note on August 5.
b.
To determine
Journalize the payment of principal amount on September 19 (maturity date).
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Lundquist Company received a 60-day, 6% note for $37,500, dated July 23, from a customer on account. Required: a. Determine the due date of the note. b. Determine the maturity value of the note. Assume 360 days in a year. c. Journalize the entry to record the receipt of the payment of the note at maturity. Refer to the Chart of Accounts for exact wording of account titles.
ASSETS
110
Cash
111
Petty Cash
120
Accounts Receivable
129
Allowance for Doubtful Accounts
132
Notes Receivable
141
Merchandise Inventory
145
Office Supplies
146
Store Supplies
151
Prepaid Insurance
181
Land
191
Store Equipment
192
Accumulated Depreciation-Store Equipment
193
Office Equipment
194
Accumulated Depreciation-Office Equipment
LIABILITIES
210
Accounts Payable
211
Salaries Payable
213
Sales Tax Payable
214
Interest Payable
215
Notes Payable
EQUITY
310
Owner, Capital
311
Owner, Drawing
312
Income Summary
REVENUE
410…
Copperfield and Company issued a 90-day, 6.00% note for $200,000 to a creditor on account. The previous clerk entered the following journal entries to record the note on July 10, and the payment of the note at maturity.
1
2
3
4
5
DATE
1
JUL 10 Accounts Payable
Notes Payable
2
3
Notes Payable
Accounts Payable
Interest Expense
DATE
DESCRIPTION
JOURNAL
Jul 10 Accounts Payable
POST. REF.
DESCRIPTION
Journalize the payment of the note at maturity as it should have been journalized. Don't forget to include the date. Assume a 360-day year.
All transactions on this page must be entered (except for post ref(s)) before you will receive Check My Work feedback.
DEBIT
200,000.00
JOURNAL
212,000.00
POST. REF.
CREDIT
You notice that the journal entry for recording the note on July 10 is correct, but the entry for the payment of the note at maturity (including interest) did not have a date and was not correct.
200,000.00
200,000.00
12,000.00
DEBIT
20,000,000.00
Score: 4/37
CREDIT
ASSETS
200,000.00…
The following selected transactions for notes receivable are for Accustart Limited.
May
1
Received a six-month, 5%, $13,440 note on account from Blackstone Limited. Interest is due at maturity.
June
30
Accrued interest on the Blackstone note on this date, which is Accustart’s year end.
July
1
Lent $11,200 cash to an employee, Noreen Wong, issuing a three-month, 7% note. Interest is due at the beginning of each month, starting August 1.
Aug.
1
Received the interest due from Ms. Wong.
Sept.
1
Received the interest due from Ms. Wong.
Oct.
1
Received payment in full for the employee note from Ms. Wong.
Nov.
1
Wrote off the Blackstone note because Blackstone defaulted. Future payment is not expected.
Record the above transactions for Accustart Limited. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account…
Chapter D Solutions
College Accounting (Book Only): A Career Approach
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- Record the following transactions in general journal form: Issued a $6,000 note to Shelter, Inc for 72 days at 10% on account. 2. Discounted a $6,000, 36-day, 6% note payable at the bank. 3.Paid the note due its due date in (b)arrow_forwardThe following selected transactions for notes receivable are for Marx Limited. May 1 Received a six-month, 5%, $15,120 note on account from Blackstone Limited. Interest is due at maturity. June 30 Accrued interest on the Blackstone note on this date, which is Marx's year end. July 1 Lent $13,200 cash to an employee, Noreen Wong, issuing a three-month, 7% note. Interest is due at the beginning of each month, starting August 1. Aug. 1 Received the interest due from Ms. Wong. Sept. 1 Received the interest due from Ms. Wong. Oct. 1 Received payment in full for the employee note from Ms. Wong. Nov. 1 Wrote off the Blackstone note because Blackstone defaulted. Future payment is not expected. Record the above transactions for Marx Limited. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually if no entry is required, select "No Entry" for the account titles and enter O for the amounts. Record entries in…arrow_forwardMay 13: Paid the invoice of April 14. Date Description Debit Credit May 13 May 17: Received cash from daily cash sales for $21,200. The amount indicated by the cash register was $21,240. Date Description Debit Credit May 17 June 2: Received a 60-day, 8% note for $180,000 on the Ryanair account. Date Description Debit Credit June 2 Aug. 1: Received amount owed on June 2 note, plus interest at the maturity date. Date Description Debit Credit Aug. 1arrow_forward
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