Question

The following selected transactions are from Ohlm Company 2014 Accepted a $10,800, 60-day, 8% note dated this day in granting Danny Todd a time extension on his past-due account receivable. Dec. 16 31 Made an adjusting entry to record the accrued interest on the Todd note 2015 Feb. 14 Received Todd's payment of principal and interest on the note dated December 16 Mar. 2 Accepted a $6,100, 89, 90-day note dated this day in granting a time extension on the past-due account receivable from Midnight Co. Accepted a $2.400, 30-day, 7% note dated this day in granting Ava Privet a time extension on her past. due account receivable. 17 Apr. 16 Privet dishonored her note when presented for payment May 31 Midnight Co. refuses to pay the note that was due to Ohlm Co. on May 31. Prepare the journal entry to July 16 Received payment from Midnight Co. for the maturity value of its dishonored note plus interest for 46 Aug. 7 Accepted a $7,450, 90-day, 10% note dated this day in granting a time extension on the past-due Sept. 3 Accepted a $2,100, 60-day, 10% note dated this day in granting Noah Carson a time extension on his charge the dishonored note plus accrued interest to Midnight Co's accounts receivable. days beyond maturity at 8%. account receivable of Mulan Co. past-due account receivable. Nov. 2 Received payment of principal plus interest from Carson for the September 3 note. Nov. 5 Received payment of principal plus interest from Mulan for the August 7 note. Dec. 1 Wrote off the Privet account against Allowance for Doubtful Accounts

Answer 1

2014		Debit	Credit
Dec.16	Notes receivable—D. Todd	$ 10,800.00
	Accounts receivable—D. Todd		$ 10,800.00
Dec.31	Interest receivable (10,800x 8% x 15/360)	$          36.00
	Interest revenue		$          36.00
2015
Feb.14	Cash	$ 10,944.00
	Interest revenue (10,800x 8% x 45/360)		$        108.00
	Interest receivable		$          36.00
	Notes receivable—D. Todd		$ 10,800.00
Mar.02	Notes receivable—Midnight Co	$    6,100.00
	Accounts receivable—Midnight Co		$    6,100.00
Mar.17	Notes receivable—A. Privet	$    2,400.00
	Accounts receivable—A. Privet		$    2,400.00
Apr.16	Accounts receivable—A. Privet	$    2,414.00
	Interest revenue (2,400x 7% x 30/360)		$          14.00
	Notes receivable—A. Privet		$    2,400.00
May.31	Accounts receivable—Midnight Co	$    6,222.00
	Interest revenue (6,100x 8% x 90/360)		$        122.00
	Notes receivable—Midnight Co		$    6,100.00
Jul.16	Cash	$    6,286.00
	Interest revenue (6,222x 8% x 46/360)		$          64.00
	Accounts receivable—Midnight Co		$    6,222.00
Aug.07	Notes receivable—Mulan	$    7,450.00
	Accounts receivable—Mulan		$    7,450.00
Sep.03	Notes receivable—N. Carson	$    2,100.00
	Accounts receivable—N. Carson		$    2,100.00
Nov.02	Cash	$    2,135.00
	Interest revenue (2,100x 10% x 60/360)		$          35.00
	Notes receivable—N. Carson		$    2,100.00
Nov.05	Cash	$    7,636.00
	Interest revenue (7,450x 10% x 90/360)		$        186.00
	Notes receivable—Mulan		$    7,450.00
Dec.01	Allowance for doubtful accounts	$    2,414.00
	Accounts receivable—A. Privet		$    2,414.00