1. On January 1, 2020, Kappa Company determined that it would not be able to pay the accounts receivable that was owed to Moon Company. Kappa Company believed that it would have sufficient cash one year later, therefore signed a one-year note receivable for the $19,000 that was owed. The annual interest rate is 7% payable on July 1 and January 1. Moon Company has a year-end of June 30. On January 1, 2021, Kappa Company dishonored the note because it went bankrupt. Moon Company assessed that the debt will never be collected and decided to immediately write off the note.

Required a) Prepare the journal entry for Moon Company when the note is signed.

Date	Account Title and Explanation	Debit	Credit
Jan 1
	To record notes receivable in replacement of accounts receivable

b) Prepare the journal entry for the year-end adjustment.

Date	Account Title and Explanation	Debit	Credit
Jun 30
	To record accrued interest revenue

c) Prepare the journal entry for the receipt of the first interest payment.

Date	Account Title and Explanation	Debit	Credit
Jul 1
	To record receipt of interest payment

d) Prepare the journal entries to write off Kappa Company's note on January 1, 2021, using the allowance for doubtful accounts.

For transactions that have 2 debits or 2 credits, enter the accounts in alphabetical order.

Date	Account Title and Explanation	Debit	Credit
Jan 1
	To accrue interest on the note
Jan 1
	To record the write off of the note receivable

2. On February 1, 2020, Great Things Company accepted a six-month note receivable as an extension of time for a balance of $19,000 owing from Climbing Company. The note has an annual interest rate of 6%. Great Things Company has a June 30 year-end.

Required a) Prepare the journal entry for Great Things Company when the note is signed.

Date	Account Title and Explanation	Debit	Credit
Feb 1
	To convert accounts receivable to a note receivable

b) Prepare the journal entry for the year-end adjustment.

Date	Account Title and Explanation	Debit	Credit
Jun 30
	To accrue interest at year-end

c) Climbing Company honored the note. Prepare the journal entry upon payment.

Round your answers to 2 decimal places. Enter credit entries in alphabetical order.

Date	Account Title and Explanation	Debit	Credit
Aug 1
	To receive note at maturity

3. Weyland-Yutani Company has net accounts receivable opening balance of $310,000 and an ending balance of $338,000. The total sales amount for the year is $2,480,000, of which 85% are on credit. Normal credit terms are 30 days. Calculate the day sales outstanding and the accounts receivable turnover.

Do not enter dollar signs or commas in the input boxes. For day sales outstanding, round to the nearest whole number.

Day Sales Outstanding = # days

For accounts receivable turnover, round to one decimal place.

Accounts Receivable Turnover = # times

4. The following information relevant to accounts receivable is presented for Dommar Company (in thousands of dollars). Calculate the accounts receivable turnover ratio, and the day sales outstanding ratio for the years 2019 and 2020.

	2020	2019	2018
Accounts Receivable	$335	$324	$369
Allowance for Doubtful Accounts	$16	$20	$19
Net Credit Sales	$4,021	$4,447	$2,618
Accounts Receivable Turnover (in number of times)
Day Sales Outstanding (in days)

On January 2, 2021, Dommar Company agreed to sell $226,000 of its accounts receivable with a 5% fee paid to the factor. Prepare the journal entry to record the factoring of accounts receivable.

Do not enter dollar signs or commas in the input boxes. Enter the debit accounts in alphabetical order.

Date	Account Title and Explanation	Debit	Credit
Jan 2
	To record sale of accounts receivable