Question 6 of 6 > - /1 E View Policies Current Attempt in Progress On September 1, 2020, Teal Mountain Inc sold goods to Indigo Corporation, a new customer. Before shipping the goods, Teal Mountain's credit and collections department conducted a procedural credit check and determined that Indigo is a high credit-risk customer. As a result, Teal Mountain did not provide Indigo with open credit by recording the sale as an account receivable. Instead, Teal Mountain required Indigo to provide a non-interest-bearing promissory note for $42,700 face value to be repaid in one year. Indigo has a credit rating that requires it to pay 12% interest on borrowed funds. Teal Mountain pays 10% interest on a loan recently obtained from its local bank. Teal Mountain has a December 31 year end. The tables in this problem are to be used as a reference for this problem Click here to view the factor table PRESENT VALUE OF 1 Click here to view the factor table PRESENT VALUE OF AN ANNUITY OF 1. Prepare the entries required on Teal Mountain's books to record the sale, annual adjusting entry, and collection of the note's full face value. (For calculation purposes, use 5 decimal places as displayed in the factor table provided. 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 for the amounts. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit September 1, 2020 Notes Receivable Sales Revenue December 31, 2020 Notes Receivable Interest Income September 1, 2021 Notes Receivable Interest Income (To record interest income) Cash September 1, 2021 Notes Receivable (To record collection of the note receivable) eTextbook and Media List of Accounts Assume that on the note's maturity date, Indigo informs Teal Mountain that it is having cash flow problems and can only pay Teal Mountain only 80% of the note's face value. After extensive discussions with Indigo's management, Teal Mountain's credit and collections department considers the remaining balance of the note uncollectible. Prepare the entry required on Teal Mountain's books on the note's maturity date. (For calculation purposes, use 5 decimal places as displayed in the factor table provided. 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 for the amounts.) Account Titles and Explanation Debit Credit Assume that on the note's maturity date, Indigo informs Teal Mountain that it is having cash flow problems and can only pay Teal Mountain only 80% of the note's face value. After extensive discussions with Indigo's management, Teal Mountain's credit and collections department considers the remaining balance of the note uncollectible. Prepare the entry required on Teal Mountain's books on the note's maturity date. (For calculation purposes, use 5 decimal places as displayed in the factor table provided. 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 for the amounts.) Account Titles and Explanation Debit Credit eTextbook and Media List of Accounts Attempts:0 of 3 used Submit Answer Save for Later Last saved 4 hours ago Saved work will be auto-submitted on the due date. Using multiple attempts will impact your score. Question 6 of 6 > - /1 E View Policies Current Attempt in Progress On September 1, 2020, Teal Mountain Inc sold goods to Indigo Corporation, a new customer. Before shipping the goods, Teal Mountain's credit and collections department conducted a procedural credit check and determined that Indigo is a high credit-risk customer. As a result, Teal Mountain did not provide Indigo with open credit by recording the sale as an account receivable. Instead, Teal Mountain required Indigo to provide a non-interest-bearing promissory note for $42,700 face value to be repaid in one year. Indigo has a credit rating that requires it to pay 12% interest on borrowed funds. Teal Mountain pays 10% interest on a loan recently obtained from its local bank. Teal Mountain has a December 31 year end. The tables in this problem are to be used as a reference for this problem Click here to view the factor table PRESENT VALUE OF 1 Click here to view the factor table PRESENT VALUE OF AN ANNUITY OF 1. Prepare the entries required on Teal Mountain's books to record the sale, annual adjusting entry, and collection of the note's full face value. (For calculation purposes, use 5 decimal places as displayed in the factor table provided. 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 for the amounts. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit September 1, 2020 Notes Receivable Sales Revenue December 31, 2020 Notes Receivable Interest Income September 1, 2021 Notes Receivable Interest Income (To record interest income) Cash September 1, 2021 Notes Receivable (To record collection of the note receivable) eTextbook and Media List of Accounts Assume that on the note's maturity date, Indigo informs Teal Mountain that it is having cash flow problems and can only pay Teal Mountain only 80% of the note's face value. After extensive discussions with Indigo's management, Teal Mountain's credit and collections department considers the remaining balance of the note uncollectible. Prepare the entry required on Teal Mountain's books on the note's maturity date. (For calculation purposes, use 5 decimal places as displayed in the factor table provided. 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 for the amounts.) Account Titles and Explanation Debit Credit Assume that on the note's maturity date, Indigo informs Teal Mountain that it is having cash flow problems and can only pay Teal Mountain only 80% of the note's face value. After extensive discussions with Indigo's management, Teal Mountain's credit and collections department considers the remaining balance of the note uncollectible. Prepare the entry required on Teal Mountain's books on the note's maturity date. (For calculation purposes, use 5 decimal places as displayed in the factor table provided. 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 for the amounts.) Account Titles and Explanation Debit Credit eTextbook and Media List of Accounts Attempts:0 of 3 used Submit Answer Save for Later Last saved 4 hours ago Saved work will be auto-submitted on the due date. Using multiple attempts will impact your score