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Mar. 17 Accounts receivable of $3,300 were written off as uncollectible. The company uses the allowance method. 30 Loaned an officer of the company $39,000
Mar. | 17 | Accounts receivable of $3,300 were written off as uncollectible. The company uses the allowance method. | ||
30 | Loaned an officer of the company $39,000 and received a note requiring principal and interest at 7% to be paid on March 30, 2022. | |||
May | 30 | Discounted the $39,000 note at a local bank. The banks discount rate is 8%. The note was discounted without recourse and the sale criteria are met. | ||
June | 30 | Sold merchandise to the Blankenship Company for $28,000. Terms of the sale are 2/10, n/30. Weldon uses the gross method to account for cash discounts. | ||
July | 8 | The Blankenship Company paid its account in full. | ||
Aug. | 31 | Sold stock in a nonpublic company with a book value of $6,600 and accepted a $8,100 noninterest-bearing note with a discount rate of 8%. The $8,100 payment is due on February 28, 2022. The stock has no ready market value. | ||
Dec. | 31 | Weldon estimates that the allowance for uncollectible accounts should have a balance in it at year-end equal to 3% of the gross accounts receivable balance of $950,000. The allowance had a balance of $28,000 at the start of 2021. |
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