Question
Show Me How Details of Notes Receivable and Related Entries Gen-X Ads Co. produces advertising videos. During the current fiscal year, Gen-X Ads Co. received
Show Me How
Details of Notes Receivable and Related Entries
Gen-X Ads Co. produces advertising videos. During the current fiscal year, Gen-X Ads Co. received the following notes:
| Date | Face Amount | Interest Rate | Term | ||||
| 1. | Apr. 10 | $78,000 | 4% | 60 | days | ||
| 2. | June 24 | 18,000 | 6 | 30 | days | ||
| 3. | July 1 | 72,000 | 6 | 120 | days | ||
| 4. | Oct. 31 | 72,000 | 5 | 60 | days | ||
| 5. | Nov. 15 | 90,000 | 6 | 60 | days | ||
| 6. | Dec. 27 | 144,000 | 4 | 30 | days | ||
Required:
Assume 360 days in a year.
1. Determine for each note (a) the due date and (b) the amount of interest due at maturity, identifying each note by number.
| Note | (a) Due Date | (b) Interest Due at Maturity | |
| (1) | Apr. 14Apr. 30June 9June 10 | $fill in the blank c38a13088006ff9_2 | |
| (2) | June 24June 30July 24July 25 | fill in the blank c38a13088006ff9_4 | |
| (3) | July 1July 31Oct. 28Oct. 29 | fill in the blank c38a13088006ff9_6 | |
| (4) | Oct. 31Dec. 21Dec. 30Dec. 31 | fill in the blank c38a13088006ff9_8 | |
| (5) | Nov. 16Nov. 30Jan. 14June 15 | fill in the blank c38a13088006ff9_10 | |
| (6) | July 21Jan. 26Jan. 27Jan. 31 | fill in the blank c38a13088006ff9_12 | |
2. Journalize the entry to record the dishonor of Note (3) on its due date. If an amount box does not require an entry, leave it blank or enter "0".
| Jul. 1Jul. 31Oct. 28Oct. 29 | Accounts PayableAccounts ReceivableBad Debt ExpenseCashInterest ReceivableNotes Receivable | - Select - | - Select - |
| Accounts ReceivableBad Debt ExpenseCashInterest ReceivableNotes PayableNotes Receivable | - Select - | - Select - | |
| Accounts ReceivableBad Debt ExpenseCashInterest ReceivableInterest RevenueSales | - Select - | - Select - |
3. Journalize the adjusting entry to record the accrued interest on Notes (5) and (6) on December 31.
| Dec. 31 | CashInterest PayableInterest ReceivableInterest RevenueNotes ReceivableUnearned Interest | - Select - | |
| CashInterest PayableInterest ReceivableInterest RevenueNotes ReceivableUnearned Interest | - Select - |
4. Journalize the entries to record the receipt of the amounts due on Notes (5) and (6) in January. If an amount box does not require an entry, leave it blank or enter "0".
| Jan. 14 | Accounts PayableAccounts ReceivableCashInterest ReceivableInterest RevenueNotes Receivable | - Select - | - Select - |
| Accounts PayableAccounts ReceivableCashInterest ExpenseNotes ReceivableSales | - Select - | - Select - | |
| Accounts ReceivableAllowance for Doubtful AccountsCashInterest PayableInterest ReceivableNotes Payable | - Select - | - Select - | |
| Accounts ReceivableCashInterest PayableInterest RevenueNotes PayableSales | - Select - | - Select - | |
| Jan. 26 | Accounts ReceivableCashInterest ReceivableInterest RevenueNotes ReceivableSales | - Select - | - Select - |
| Accounts ReceivableCashInterest ExpenseInterest PayableNotes ReceivablePrepaid Interest | - Select - | - Select - | |
| Accounts ReceivableCashInterest ExpenseInterest PayableInterest ReceivableNotes Payable | - Select - | - Select - | |
| Accounts ReceivableCashInterest ExpenseInterest PayableInterest RevenueNotes Payable | - Select - | - Select - |
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Analysing Financial Statements For Non-Specialists
Authors: Jim OHare
2nd Edition
1138641529, 9781138641525
