Question

My main issue with this following problem is the Interest Receivable and the Interest Revenue, I got everything else correct but I am unsure about these two. Thank you for your help!

Bramble Corp. 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		Loaned $13,200 cash to Manny Lopez on a 12 month, 10% note.
Dec. 11		Sold goods to Ralph Kremer, Inc., receiving a $24,750, 90-day, 8% note.
16		Received a $29,100, 180 day, 8% note in exchange for Joe Fernetti’s outstanding accounts receivable.
31		Accrued interest revenue on all notes receivable

Journalize the transactions for Bramble Corp. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Use 360 days for calculation. Round answers to 0 decimal places, e.g. 5,275. Record journal entries in the order presented in the problem.)

Date	Account Titles and Explanation	Debit	Credit
Nov. 1	Notes Receivable
	Cash	enter a debit amount	enter a credit amount
11Dec.	Notes Receivable	enter a debit amount	enter a credit amount
	Sales Revenue	enter a debit amount	enter a credit amount
Dec. 16	Notes Receivable	enter a debit amount	enter a credit amount
	Accounts Receivable	enter a debit amount	enter a credit amount
Dec. 31	Interest Receivable	enter a debit amount	enter a credit amount
	Interest Revenue	enter a debit amount	enter a credit amount

Answer 1

Solution Required : Journalize the transactions Credit Date Nov. 1, 2020 Debit $13,200 I Account Titles and Explanation Notes Receivable Cash (To record amount loaned to Manny Lopez) $13,200 Dec. 11, 2020 $24,7501 Notes Receivable Sales Revenue (To record sale of merchandise for notes) $24,750 Dec. 16, 2020 $29,100 Notes Receivable Accounts Receivables (To record note in exchange of accounts receivable) $29,100 Dec. 31, 2020 $4271 Interest Receivable (WN-1) Interest Revenue (To record accrued interest revenue on notes receivable) $427 WN-1: Calculation of accrued interest revenue on notes receivables 12 month, 10% note Accrued interest revenue = $13,200 x 10% x 2 / 12 = $220 90 days, 8% note Accrued interest revenue = $24,750 x 8% x 20 days / 360 days = $110 180 days, 8% note Accrued interest revenue = $29,100 x 8% x 15 days / 360 days = $97 Accrued interest revenue $427