Question

*Exercise 9-12 a-b Skysong Supply Co. has the following transactions related to notes receivable during the last 2 months of 2020. The company does not make entries to accrue interest except at December 31. Nov. 1 Dec. 11 16 31 Loaned $27,600 cash to Manny Lopez on a 12-month, 10% note. Sold goods to Ralph Kremer, Inc., receiving a $81,000, 90-day, 8% note. Received a $82,080, 180 day, 10% note in exchange for Joe Fernetti's outstanding accounts receivable. Accrued interest revenue on all notes receivable. Journalize the transactions for Skysong Supply Co. (Ignore entries for cost of goods sold.) (Credit account titles are automatically indented when amount is entered. Do not Indent manually. Use 360 days for calculation. Round answers to o decimal places, e.g. 5,275. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Credit Record the collection of the Lopez note at its maturity in 2021. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Use 360 days for calculation.) Date Account Titles and Explanation Debit Credit Nov. 1

Answer 1

Soltion Date Tournal Debit Credit 1 Nov 10 % Note 91eceivable 37600 22600 cash [Being cash Looned and note greceived] 11-bec 8% Note rreceivable 81000 81000 Sales ( Being sales made and note received] 16-DEC 9% Note receivable 92060 Accounts receivable 82080 ( Being Note received from Accounts Receivable] 31-Dec Interest Recelvable 1162 Interest Revenue 1162 [ Being Interest due 2018 30360 I-Nov 3300 Cash Interest Receivable [ 27600 X 100 X 10/12 months) Interest Revenue [ 27600 X 10% X 2/12 Months 10% Note [Being 10% Note Matured] 460 27600

calculation of Interest on 31st March! Interest on Novi, Note = (27600 * 10% X 2/12 Months) = 460 Interest on Dec II, Nole = (81000X8 % X 20/360 Days) - 360 Interest on Dec 16, Note = (82080 y 10% X 15/360 Days) 342 Total Interest = 1162 (460 + 360 + 342)