Evergreen Company sells lawn and garden products to wholesalers. The company's fiscal year-end is December 31 . During 2024 , the following transactions related to recelvables occurred: February 28 soid merchandise to Lennox, Incorporated, for 520 , eee and accepted a 67,7 -month note. 67 is an appropriate rate for this type of note. March 31 Sold merchandise to Maddox Company that had a fair value of $15,040, and accepted a noninterest-bearing note for which $16,00e payment is due on March 31,2025. April 3 Sold merchandise to Carr Company for $14,68e with terms 2/10,n/3e. Evergreen uses the grass method to account for cash discounts. Apri1 11 collected the entire amount due from Carr Company April 17 A customer returned merchandise costing $4,800. Evergreen reduced the customer's receivable balance by $6,560, the sales price of the merchandise. Sales returns are recorded by the company as they occur. April 3e. Transferred receivables of $66,0ee to a factor without recourse. The factor charged Evergreen a 15 finance charge on the receivables transferred. The sale criteria are met. June 3e - Discounted the Lennox, Incorporated, note at the bank. The bank's discount rate is 8x. The note was discounted without recourse. September 3e Lennox, Incorporated, 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 sold 2. Prepare any necessary adjusting entries at December 31, 2024. Adjusting entries are only recorded at year-end. 3. Prepare a schedule showing the effect of the journal entries on 2024 income before taxes. Evergreen Company sells lawn and garden products to wholesalers. The company's fiscal year-end is December 31 . During 2024 , the following transactions related to recelvables occurred: February 28 soid merchandise to Lennox, Incorporated, for 520 , eee and accepted a 67,7 -month note. 67 is an appropriate rate for this type of note. March 31 Sold merchandise to Maddox Company that had a fair value of $15,040, and accepted a noninterest-bearing note for which $16,00e payment is due on March 31,2025. April 3 Sold merchandise to Carr Company for $14,68e with terms 2/10,n/3e. Evergreen uses the grass method to account for cash discounts. Apri1 11 collected the entire amount due from Carr Company April 17 A customer returned merchandise costing $4,800. Evergreen reduced the customer's receivable balance by $6,560, the sales price of the merchandise. Sales returns are recorded by the company as they occur. April 3e. Transferred receivables of $66,0ee to a factor without recourse. The factor charged Evergreen a 15 finance charge on the receivables transferred. The sale criteria are met. June 3e - Discounted the Lennox, Incorporated, note at the bank. The bank's discount rate is 8x. The note was discounted without recourse. September 3e Lennox, Incorporated, 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 sold 2. Prepare any necessary adjusting entries at December 31, 2024. Adjusting entries are only recorded at year-end. 3. Prepare a schedule showing the effect of the journal entries on 2024 income before taxes
