4 Problem 7-10 Miscellaneous receivable transactions [LO7-3,7-4, 7-7, 7-8] Evergreen Company sells lawn and garden products to wholesalers. The company's fiscal year-end is December 31. During 2018, the following transactions related to recelvables occurred Feb. 28 Sold merchandise to Lennox, Inc. for $30,000 and accepted a 8%, 7-month note Mar 31 Sold merchandise to Maddox Co. and accepted a noninterest-bearing note with a Apr. 3 Sold merchandise to Carr Co. for $20,000 with terms 2/10, n/30. Evergreen uses 4 points 8 is an appropriate rate for this type of note. discount rate of 8%. The $22,000 payment is due on March 31, 2019 the gross method to account for cash discounts eBook 11 Collected the entire amount due from Carr Co 17 A customer returned merchandise costing $4,300. Evergreen reduced the customer's receivable balance by $6,100, the sales price of the merchandise Sales returns are recorded by the company as they occur Reference 30 Transferred receivables of $61,000 to a factor without recourse. The factor charged Evergreen a 1% finance charge on the receivables transferred. The sale criteria are met. June 30 Discounted the Lennox, Inc., note at the bank. The bank's discount rate is 10% The note was discounted without recourse. Sep. 30 Lennox, Inc, paid the note amount plus interest to the bank Required 1. Prepare the necessary journal entries for Evergreen for each of the above dates. For transactions involving the sale of merchandise, ignore the entry for the cost of goods solcd. 2. Prepare any necessary adjusting entries at December 31, 2018. Adjusting entries are only recorded at year-end. 3. Prepare a schedule showing the effect of the journal entries on 2018 income before taxes. Complete this question by entering your answers in the tabs below Required Required Required 2 Prepare the necessary journal entries for Evergreen for each of the above dates. For transactions involving the sale of merchandise, ignore the entry for the cost of goods sold. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations. Round your final answers to the nearest whole dollar.) Show less View transaction list Journal entry worksheet Collected the entire amount due from Carr Co. Note: Enter debits before credits. Date April 11, 2018 General Journal DebitCredit Record entry View general journal Clear entry Journal entry worksheet 12 3 45 6 7 8 9 10 > Evergreen reduced the customer's receivable balance by $6,100, the sales price of the merchandise. Sales returns are recorded by the company as they occur. Note: Enter debits before credits. Date April 17, 2018 General Journal DebitCredit Record entry View general journal Clear entry Journal entry worksheet K12 345 67 89 10 > A customer returned merchandise costing $4,300 Note: Enter debits before credits Date General Journal DebitCredit April 17, 2018 Record entry View general journal Clear entry Journal entry worksheet 1 23 4 5 6 7 8 9 10 Transferred receivables of $61,000 to a factor withouft recourse. The factor charged Evergreen a 1% finance charge on the receivables transferred. The sale criteria are_met. Note: Enter debits before credits. Date General Journal DebitCredi April 30, 2018 Record entry View general journal Clear entry Journal entry worksheet K12 3 4 5 6 78 9 10> Accrued four months of interest on the note receivable issued on February 28. Note: Enter debits before credits. Date June 30, 2018 General Journal DebitCredit Record entry View general journal Clear entry Journal entry worksheet 1 2 3 45 6 7 89 10 Discounted the Lennox, Inc., note at the bank. The bank's discount rate is 10%. The note was discounted without recourse. Note: Enter debits before credits. Date June 30, 2018 General Journal Debit Credit Record entry View general journal Clear entry Journal entry worksheet 1 23 4 5 6 78 9 10 Lennox, Inc., paid the note amount plus interest to the bank. Note: Enter debits before credits. Date September 30, 2018 General Journal DebitCredit Record entry View general journal Clear entry RequiredRequired Required 1 2 3 Prepare any necessary adjusting entries at December 31, 2018. Adjusting entries are only recorded at year-end. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Show less View transaction list Journal entry worksheet Record accrued interest at December 31, 2016. Note: Enter debits before credits. Debit Credit Date December 31, 2018 General Journal Record entry View general journal Clear entry Required! Required 3 Required Required Required 1 2 3 Prepare a schedule showing the effect of the journal entries on 2018 income before taxes. (Decreases should be indicated with a minus sign. Do not round intermediate calculations. Round your final answers to the nearest whole dollar.) Show lessA Income increase decrease Date February 28 March 31 April 3 April 11 April 17 April 17 April 30 June 30 June 30 December Total effect Required 2 Required 3