Question

Wildhorse Co. closes its books on its July 31 year-end. The company does not make entries to accrue for interest except at its year-end. On June 30, the Notes Receivable account balance is $26,800. Notes Receivable include the following. Date Maker Face Value Term Maturity Date Interest Rate $5,200 90 days July 20 8% April 21 May 25 Coote Inc. Brady Co. 8,400 60 days July 24 10% June 30 BMG Corp. 13,200 6 months December 31 6% During July, the following transactions were completed. July 5 Made sales of $4,900 on Wildhorse credit cards. 14 Made sales of $800 on Visa credit cards. The credit card service charge is 2%. 20 Received payment in full from Coote Inc. on the amount due. 24 Received payment in full from Brady Co. on the amount due. - Your answer is partially correct. Enter the balances at July 1 in the receivable accounts and post the entries to all of the receivable accounts. (Post entries in the order of journal entries posted in the previous part.) Notes Receivable

Answer 1

Credit Date July.5 Debit 4,900 4,900 July. 14 784 16 800 July. 20 5,304 Account title Accounts receivable Sales revenue Cash (800x98%) Service charge expense (800x2%) Sales revenue Cash Notes receivable Interest revenue (5,200x8%x90/360) Cash Notes receivable Interest revenue (8,400x10%x60/360) Interest receivable Interest revenue (13,200x6%x30/360) 5,200 104 July.24 8,540 8,400 140 July. 31 66

7/1 Bal. Notes receivable 26,800 7/20 7/24 13,200 5,200 8,400 7/31 Bal 7/5 7/31 Bal. Accounts receivable 4,900 4,900 Interest receivable 66 7/31 7/31 Bal. 66