Seerden Servicing monitors its accounts receivable carefully. A review determined that a customer, John Daley, was unable

Question:

Seerden Servicing monitors its carefully. A review determined that a customer, John Daley, was unable to pay his $130,000 past-due account. Seerden accepted a 90-day promissory note dated April 15, 2014, bearing interest of 5% in exchange for Daley's account. Another customer, ABC Drilling, signed a 4.75%, six-month note dated May 1 in place of its $50,000 past-due On May 31, Seerden's year-end, accrued interest was recorded on the notes receivable. John Daley honoured his note on the date. ABC Drilling dishonoured its note on the date. On November 15, Seerden Servicing wrote off ABC Drilling's account as it was determined to be uncollectible.
Required
Prepare Seerden Servicing's entries for each of the following dates (round calculations to the nearest whole cent):
a. April 15, 2014
b. May 1, 2014
c. May 31, 2014
d. date of John Daley's note
e. date of ABC Drilling's note
f. November 15, 2014
Analysis Component:
Assuming a $4,000 debit balance in the Allowance for Doubtful Accounts on November 14, 2014, calculate the balance after posting the entry in (f) above. Comment on the adequacy of the Allowance for Doubtful Accounts. Accounts Receivable
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