Question

Year 1 Dec. 16 Accepted a $11,000, 60-day, 6% note in granting Danny Todd a time extension on his past-due account receivabl 31 Made an adjusting entry to record the accrued interest on the Todd note. Year 2 Feb. 14 Received Todd's payment of principal and interest on the note dated December 16. Mar. 2 Accepted a(n) $7,400, 6%, 90-day note in granting a tine extension on the past due account receivable from Mid 17 Accepted a(n) $2,400, 30-day, 7% note in granting Ava Privet a time extension on her past-due account receivat Apr. 16 Privet dishonored her note. May 31 Midnight Co. dishonored its note. Aug. 7 Accepted a(n) $8,200, 90-day, 8% note in granting a time extension on the past.due account receivable of Mulan Sep. 3 Accepted a(n) $2,530, 60-day, 11% note in granting Noah Carson a time extension on his past due account receiv 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 the Allowance for Doubtful Accounts. Required: 1-a. First, complete the table below to calculate the interest amount at December 31, Year 1. 1-b. Use the calculated value to prepare your journal entries for Year 1 transactions 1-c. First, complete the table below to calculate the interest amounts 1-d. Use those calculated values to prepare your journal entries for Year 2 transactions. 2. If Ohlm pledged its receivables as security for a loan from the bank, where on the financial statements does it discloset of receivables?

Answer 1

D.Todd note-December 16,2012
		total	interest
		through	recognized
		maturity	31-Dec
Principal		11,000	11,000
Rate(%)		6%	6%
time		60/360	15/360
total interest		110	28
Date	General journal				Debit	credit
2016
16-Dec	Note receivable				11,000
	Account receivable					11,000
31-Dec	interest receivable				28
	interest revenue					28
		Midnight	privet	Mulan		carson
		2-Mar	17-Mar	7-Aug		3-Sep
		2018	2018	2018		2018
Principal		7,400	2,400	8,200		2,530
Rate(%)		6%	7%	8%		11%
time		90/360	30/360	90/360		60/360
total interest		111	14	164		46

Date	General journal				Debit	credit
2017
14-Feb	Cash				11110
	interest revenue					83
	Note receivable-T Todd					11,000
	interest receivable					28
2-Mar	Note receivable				7,400
	Account receivable-Midnight co					7,400
17-Mar	Note receivable				2,400
	Account receivable-Privet					2,400
16-Apr	Account receivable-privet				2,414
	note receivable					2,400
	interest revenue					14
31-May	Account receivable-Midnight				7,511
	note receivable					7,400
	interest revenue					111
7-Aug	Note receivable				8,200
	account receivable-Mulan Co					8,200
3-Sep	Note receivable				2,530
	account receivable-Carson					2,530
2-Nov	cash				2,576
	note receivable					2,530
	interest revenue					46
5-Nov	cash				8,364
	note receivable					8,200
	interest revenue					164
1-Dec	Allowance for Doubtful accounts				2,414
	Account receivable-privet					2,414