Question

Exercise 7-14 Honoring a note LO P4 Following are transactions for Vitalo Company Nov. 1 Accepted a $5,000, 180-day, 6% note from Kelly White in granting a time extension on her past-due account receivable Dec. 31 Adjusted the year and accounts for the accrued interest earned on the white note. Apr. 30 White honored her note when presented for payment. Complete the table to calculate the interest amounts at December 31st and April 30th and use those calculated values to prepare your journal entries. (Do not round intermediate calculations. Use 360 days a year.) Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. interest

Answer 1

Vitalo Company Nov-01 Total Through Through Maturity Dec-31 5000 5000 6% 180 / 360 60 / 360 150 50 Jan-01 Through Apr-30 5000 6% 120 / 360 100 Journal Enteries Date Particulars Nov-01 Notes Receivable - K.White a/c Dr. To Accounts Receivable - K.White Debit in $ Credit in $ 5000 5000 Principal Rate % Time Total Interest 6% Dr. Dec-31 Interest Receivable a/c To Interest Revenue 50 Apr-30 5150 Cash a/c Dr. To Notes Receivable - K.White To Interest Revenue To Interest Receivable 5000 100 50