Question
Accustart Inc. had the following transactions during 2018. Accustart Inc. has a calendar year-end and does not maintain a separate Allowance for Doubtful Notes Receivable
Accustart Inc. had the following transactions during 2018. Accustart Inc. has a calendar year-end and does not maintain a separate Allowance for Doubtful Notes Receivable account.
Jan. 1 An employee signed a 6-month, 4% note due June 30 for a $20,300 company loan.
Feb. 1 One of Accustarts customers, Sarson Inc. who owed $7,200 settled their account by signing a three month, 4% note.
Mar. 31 Recorded accrued interest on all notes in preparation for issuance of quarterly financial statements.
Apr. 30 Sarson Inc. defaulted on its note. It is unlikely that Sarson will be able to pay the account.
June 30 The employee paid her note in full along with all outstanding interest.
Prepare the appropriate journal entries. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
Date Account Titles and Explanation Debit Credit Jan. 1 Feb. 1 Mar. 31 Apr. 30 June. 30Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started