Journal Entries for Accounts and Notes Receivable

Pomona, Inc., began business on January $1.$ Certain transactions for the year follow:

Jun$\mathrm{.}8$ Received a $$30,000,60$ day, six percent note on account from R$.$ Elliot.

Aug$\mathrm{.}7$ Received payment from R$.$ Elliot on her note $($principal plus interest$).$

Sep$\mathrm{.}1$ Received an $$18,000,120$ day, seven percent note from B$.$ Shore Company on account.

Dec$\mathrm{.}16$ Received a $$14,400,45$ day, eight percent note from C$.$ Judd on account.

Dec$\mathrm{.}30$ B$.$ Shore Company failed to pay its note.

Dec$\mathrm{.}31$ Wrote off B$.$ Shore$$s account as uncollectible. Ponoma, Inc. uses the allowance method of providing for credit losses.

Dec$\mathrm{.}31$ Recorded expected credit losses for the year by an adjusting entry. Accounts written off during this first year have created a debit balance in the Allowance for Doubtful Accounts of $$24,500.$ An analysis of aged receivables indicates that the desired balance of the allowance account should be $$21,300.$

Dec$\mathrm{.}31$ Made the appropriate adjusting entries for interest.

Required

Record the foregoing transactions and adjustments in general journal form. $($Round all interest income calculations to the nearest dollar.$)$

General Journal

Date Description Debit Credit

Jun$\mathrm{.}8$ Answer

Notes Receivable$$R$.$ Elliot

Answer

$30,000$

Answer

$0$

Answer

Accounts Receivable$$R$.$ Elliot

Answer

$0$

Answer

$30,000$

Received a $60-$day, $6$ percent note on account.

Aug$\mathrm{.}7$ Answer

Cash

Answer

$30,300$

Answer

$0$

Answer

Interest Income

Answer

$0$

Answer

$30,300$

Notes Receivable$$R$.$ Elliot Answer

$0$

Answer

$0$

To record receipt of principal plus interest from R$.$ Elliot.

Sep$\mathrm{.}1$ Answer

Notes Receivable$$B$.$ Shore Company

Answer

$18,000$

Answer

$0$

Answer

Accounts Receivable $-$ B$.$ Shore Company

Answer

$0$

Answer

$18,000$

Received a $120-$day, $7$ percent note on account.

Dec$\mathrm{.}16$ Answer

Notes Receivable$$C$.$ Judd

Answer

$14,400$

Answer

$0$

Answer

Accounts Receivable$$C$.$ Judd

Answer

$0$

Answer

$14,400$

Received a $45-$day, $10$ percent note on account.

Dec$\mathrm{.}30$ Answer

Accounts Receivable $-$ B$.$ Shore Company

Answer

$18,420$

Answer

$0$

Answer

Interest Income

Answer

$0$

Answer

$18,420$

Notes Receivable$$B$.$ Shore Company Answer

$0$

Answer

$420$

To record dishonoring of B$.$ Shore Company's note.

Dec$\mathrm{.}31$ Answer

Allowance for Doubtful Accounts

Answer

$18,000$

Answer

$0$

Answer

Accounts Receivable $-$ B$.$ Shore Company

Answer

$0$

Answer

$0$

To write off B$.$ Shore's account.

Dec$\mathrm{.}31$ Answer

Bad Debts Expense

Answer

$3,200$

Answer

$0$

Answer

Allowance for Doubtful Accounts

Answer

$0$

Answer

$3,200$

To record allowance for uncollectible accounts.

Dec$\mathrm{.}31$ Answer

Interest Receivable

Answer

$24,500$

Answer

$0$

Answer

Interest Income

Answer

$0$

Answer

$24,500$

To accrue interest income on December $16$ note.