Question

mewu IUI IS dulu ILIVOD.) Problem 9-5B Analyzing and journalizing notes receivable transactions C2 C3 P4 m Check Jan. 30. Cr. Interest Revenue, $32 Apr 30, Cr Interest Revenue, $124 The following transactions are from Springer Company. Year 1 Nov. 1 Accepted a $4,800, 90-day, 8% note in granting Steve Julian a time extension on his past.hu account receivable. Dec. 31 Made an adjusting entry to record the accrued interest on the Julian note. Year 2 Jan. 30 Received Julian's payment for principal and interest on the note dated November 1. Feb. 28 Accepted a $12,600, 30-day, 8% note in granting a time extension on the past-due account receivable from King Co. Mar. 1 Accepted a $6,200, 60-day, 12% note in granting Myron Shelley a time extension on his past-due account receivable. 30 The King Co. dishonored its note. Apr. 30 Received payment of principal plus interest from M. Shelley for the March 1 note. June 15 Accepted a $2,000, 72-day, 8% note in granting a time extension on the past-due account receivable of Ryder Solon. 21 Accepted a $9,500, 90-day, 8% note in granting J. Felton a time extension on his past-due account receivable. Aug. 26 Received payment of principal plus interest from R. Solon for the June 15 note. Sep. 19 Received payment of principal plus interest from J. Felton for the June 21 note. Nov. 30 Wrote off King's account against the Allowance for Doubtful Accounts. Required 1. Prepare journal entries to record these transactions and events. Analysis Component 2. If Springer pledged its receivables as security for a loan from the bank, where on the financial state- ments does it disclose this pledge of receivables? Sep. 19. Cr Interest Revenue, $190

I'm not getting all the correct numbers so can you please show the computations? We are supposed to use 360 days

Answer 1

Springer Company Journal Enteries Date Particulars Debit in $ Credit in $ Year 1 Nov-01 Note Receivable - Julian a/c Dr. 4800 To Accounts Receivable - Julian 4800 (Note Receivable accepted against Accounts Receivable) Interest Receivable a/c To Interest Revenue Dec-31 Dr. 64 64 (Interest Income accrued) 4800 x 8% x 60/360 Year 2 Cash a/c Jan-30 Dr. 4896 To Interest Revenue 32 To Interest Receivable 64 To Note Receivable - Julian 4800 (Cash for Note Receivable ) 4800 x 8% x 30/360 Feb-28 Note Receivable - King Co. a/c Dr. 12600 To Accounts Receivable - King Co. 12600 (Note Receivable accepted against Accounts Receivable) Mar-01 Note Receivable - Myron a/c Dr. 6200 To Accounts Receivable - Myron 6200 (Note Receivable accepted against Accounts Receivable) Accounts receivable - king co a/c Mar-30 Dr. 12684 To Interest revenue 84 To Notes receivable - king co 12600 (Note receivable dishonoured ) 12600 x 8% x 30/360 = 84 Apr-30 Cash a/c Dr. 6324 To Interest revenue 124 To Notes Receivable - Shelly 6200 (Payment received) 6200 x 12% x 60/360 Note Receivable - Ryder a/c Jun-15 Dr. 2000 To Notes Receivable - Ryder 2000 |(Note Receivable accepted against Accounts Receivable) Note Receivable - Felon a/c Jun-21 Dr. 9500 To Accounts Receivable - Felton 9500 (Note Receivable accepted against Accounts Receivable) Aug-26 Cash a/c Dr. 2032 To Interest revenue 32 To Notes Receivable - Ryder 2000 (Payment received) 2000 x 8% x 72/360 Sep-19 Cash a/c Dr. 9690 To Interest revenue 190 To Notes Receivable - Felton 9500 (Payment received) 9500 x 8% x 90/360 Nov-30 Allowance for Doubtful Accounts a/c Dr. 12684 To Accounts Receivable - King Co. 12684 (Uncollectibles written off)