Question Five: Note receivable--journal entries

On September 1, 2015, Dental Equipment Corporation sold equipment priced at $350,000 in exchange for a six-month note receivable with an annual interest rate of 12%, all due at maturity.

(a.) Prepare the December 31, 2015 (fiscal year-end), adjusting entry made by Dental with regard to this note receivable.

(b.) Prepare the entry made by Dental on March 1, 2016 (maturity date of note), to record collection of note and interest.

(c.) Assume that on March 1, 2016, the maker of the note defaults and Dental does not collect the note. Prepare the entry to be made to Dental on March 1, 2016, in this situation.

ACFN212 Assignment One (2).docx