Question

Journal Entries (Note Received, Renewed, and Collected) 1. Prepare general journal entries for the transactions When required, enter amounts to the nearest cent. If an amount box does not require an entry, leave it blank. Jan. 16 Received a 30-day, 9% note in payment for merchandise sale of $19,400. Feb. 15 Received $150 (interest) on the old (January 16) note: the old note is renewed for 30 days at 11% Mar. 17 Received principal and interest on the new (February 15) note 19 Received a 60-day, 9% note in payment for accounts receivable balance of $7,600. May 18 Received $114 (interest) plus $1,000 principal on the old (March 19) note; the old note is renewed for 60 days (from May 18) at 9% July 17 Received principal and interest on the new (May 18) note Assume 360 days in a year.

Answer 1

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Naming convention in drop down is not available, can be slightly different: Solution: Journal Entries Date Account title and explaination DebitCredit Jan.15 Note Receivable $ 19,400 Sales Revenue $ 19,400 To record the sales revenue on note) $ 150 $ 19,400 Feb.15 Cash Note Receivable Interest Revenue Note Receivable, old To record the collection of interest and renewal of note) $150 $ 19,400 Mar.17 Cash (19400)+(19400*11%)/360*30 $ 19,578 Interest Revenue Note Receivable To record the collection of note and principal) $178 $ 19,400 Mar.19Note Receivable $ 7,600 Accounts Receivable $ 7,600 To record the note receivable on account) (114+1000) (7600-1000) $ 1,114 $ 6,600 May.18 Cash Note Receivable Interest Revenue Note Receivable, old To record the collection of interest and partial note with renewal) $ 114 $ 7,600 ul.17 Cash (6600)+(6600*996)/360*60 $ 6,699 Interest Revenue Note Receivable To record the collection of note with interest) $ 6,600