Problem 7-5A

Part 1

2012	Accounts	Debit	Credit
2013

Part 2

Analysis Component:

Problem 7-5A Analyzing and journalizing notes receivable transactions C2 C3 P3 The following selected transactions are from Ohlmeyer Company 2012 Dec. 16 Accepted a $10,800, 60-day, 8% note dated this day in granting Danny Todd a time extension Q Sage 50 on his past-due account Made an adjusting entry to record the accrued interest on the Todd note. 31 2013 Received Todd's payment of principal and interest on the note dated December 16. Accepted an $0.100.8%, 90-day note dated this day in granting a time extension on the past due account receivable from Midnight Co. Accepted a $2.400, 30-day, 7% note dated this day in granting Ava Privet a time extension on her past-due account receivable. Feb. 14 Mar. 2 Check Feb. 14, Cr. Interest Revenue $108 17 Apr. 16 Privet dishonored her note when presented for payment. June 2 Midnight Co. refuses to pay the note that was due to Ohlmeyer Co. on May 31. Prepare the journal June 2, Cr. Interest Revenue $122 July 17 Aug. 7 Sept. 3 entry to charge the dishonored note plus accrued interest to Midnight Co.'s accounts receivable. Received payment from Midnight Co. for the maturity value of its dishonored note plus interest for 46 days beyond maturity at 8% Accepted an $7.450, 90-day, 10% note dated this day in granting a time extension on the past due account receivable of Mulan Co Accepted a $2,100, 60-day, 10% note dated this day in granting Noah Carson a time extension on his past-due account receivable. Nov. 2 Received payment of principal plus interest from Carson for the September 3 note. Nov. 5 Received payment of principal plus interest from Mulan for the August 7 note. Dec. 1 Wrote off the Privet account against Allowance for Doubtful Accounts. Required 1. Prepare journal entries to record these transactions and events. (Round amounts to the nearest dollar.) Nov. 2, Cr. Interest Revenue $35 Analysis Component 2. What reporting is necessary when a business pledges receivables as security for a loan and the loan is still outstanding at the end of the period? Explain the reason for this requirement and the accounting principle being satisfied