Flounder Family Importers sold goods to Tung Decorators for $40,800 on November
ID: 2339149 • Letter: F
Question
Flounder Family Importers sold goods to Tung Decorators for $40,800 on November 1, 2017, accepting Tung’s $40,800, 6-month, 6% note. Prepare Flounder’s November 1 entry, December 31 annual adjusting entry, and May 1 entry for the collection of the note and interest. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.)
Explanation / Answer
Solution:
Journal entries for flounder family importers:
Date Particulars Debit ($) Credit ($) Nov 1, 2017 Notes receivable dr 40,800 To sales revenue 40,800 Dec 31, 2017 Interest receivable dr ($40,800 * 6% * 2/12) 408 To Interest revenue 408 May 1, 2017 Cash 42,024 To Notes receivable 40,800 To Interest receivable 408 To Interest revenue ($40,800 * 6% * 4/12) 816 (Interest for four months accured)Related Questions
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