Question

Notes Receivable Entries

The following data relate to notes receivable and interest for Owens Co., a financial services company. (All notes are dated as of the day they are received.) Assume 360 days in a year.

Mar. 8. Received a $78,000, 6%, 60-day note on account.

31. Received a $8,400, 7%, 90-day note on account.

May 7. Received $78,780 on note of March 8.

16. Received a $52,800, 8%, 90-day note on account.

June 11. Received a $24,000, 9%, 30-day note on account.

29. Received $8,547 on note of March 31.

July 26. Received $24,180 on note of June 11.

Aug. 4. Received a $12,000, 10%, 30-day note on account.

14. Received $53,856 on note of May 16.

Dec. 2. Received $12,100 on note of August 4.

Required:

Journalize the entries to record the transactions. For a compound transactions, if an amount box does not require an entry, leave it blank.

Answer 1

Credit ($) Debit ($) 78000 Date General journal Mar-08 Notes Receivable To Account Receivable (To record receipt of note on account) 78000 8400 Mar-31 Notes Receivable To account Receivable (To record receipt of note on account) 8400 78780 May-07 Cash To Notes Receivable To Interest Revenue (To record cash received on note at due date) 78000 780 52800 May-16 Notes Receivable To Account Receivable (To record receipt of note on account) 52800 24000 Jun-11 Notes Receivable To Account Receivable (To record receipt of note on account) 24000 8547 Jun-29 Cash To Notes Receivable To Interest Revenue (To record cash received on note at due date) 8400 147

24180 24000 Jul-26 Cash To Notes Receivable To Interest Revenue (To record cash received on note at due date) 180 12000 Aug-04 Notes Receivable To Account Receivable (To record receipt of note on account) 12000 53856 52800 Aug-14 Cash To Notes Receivable To Interest Revenue (To record cash received on note at due date) 1056 12100 Dec-02 Cash To Notes Receivable To Interest Revenue (To record cash received on note at due date) 12000 100

Working note May-07 Interest Revenue $78000*6%*60/360) $780 Jun-29 Interest Revenue ($8400*7%*90/360) $147 Jul-26 Interest Revenue ($24000*9%*30/360) $180 Aug-14 Interest Revenue ($52800*8%*90/360) $1056 Dec-02 Interest Revenue ($12000*10%*30/360) $100

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