NewBay Company closes its books on July 31. On June 30 the Notes Receivable account balance is $23,800. Notes Receivable include the following.

Date Maker Face Value Term Maturity Date Interest Rate May 21 Emery Inc. $ 9,000 60 days July 20 8%

May 25 Tulane Co. 4,800 60 days July 24 10%

June 30 LSU Corp. 10,000 6 months December 31 9%

During July the following transactions were completed.

July 5 Made sales of $7,100 on NewBay credit cards.

14 Made sales of $600 on Visa credit cards. The credit card service charge is 3%.

20 Received payment in full from Emery Inc. on the amount due.

25 Received payment in full from Tulane Co. on the amount due.

Instructions

(a) Journalize the July transactions and the July 31 adjusting entry for accrued interest receivable. (Interest is computed using 360 days.)

(b) Enter the balances at July 1 in the receivable accounts and post the entries to all of the receivable accounts. (Use T accounts.)

(c) Show the balance sheet presentation of the receivable accounts at July 31.