Question

CALCULATOR STANDARD VIEW PRINTER VERSION BACK NEXT Exercise 8-13 (Part Level Submission) On May 2, McLain Company lends $29,200 to Chang, Inc., issuing a 6-month, 6% note. At the maturity date, November 2, Chang indicates that it cannot pay. (a) Your answer is correct. Prepare the entry to record the issuance of the note. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit May 2 Notes Receivable | Cash 29,200 SHOW LIST OF ACCOUNTS SHOW ANSWER LINK TO TEXT Attempts: 1 of 5 used (b) Prepare the entry to record the dishonor of the note, assuming that McLain Company expects collection will occur. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Nov. 2 Accounts Receivable Notes Receivable Interest Revenue

Answer 1

Answer-Journal Entries

	Date	Account Title and Explanation	Debit ($)	Credit ($)
a.	May 2	Notes Receivable	29,200
		Cash		29,200
		(To record the issuance of note)
b.	Nov.2	Account Receivable	30,076
		Notes Receivable		29,200
		Interest Revenue ($29,200*6%*6/12)		876
		(To record the dishonor of the note)

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