1. Determine the due date and the amount of interest due at maturity on the foll
ID: 2374840 • Letter: 1
Question
1. Determine the due date and the amount of interest due at maturity on the following notes:
Date of Note
Face Amount
Interest Rate
Term of Note
(1)
October 1
$21,000
8%
60 days
(2)
August 30
9,000
10
120 days
(3)
May 30
12,000
12
90 days
(4)
March 6
15,000
9
60 days
(5)
May 23
9,000
10
60 days
2. At the end of the current year, Accounts Receivable has a balance of $750,000; Allowance for Doubtful Accounts has a debit balance of $6,200; and net sales for the year total $3,500,000. Bad debt expense is estimated at 1/2 of 1% of net sales.
Determine (a) the amount of the adjusting entry for bad debt expense; (b) the adjusted balances of Accounts Receivable, Allowance of Doubtful Accounts; and Bad Debt Expense; and (c) the net realizable value of accounts receivable.
3. At the end of the current year, Accounts Receivable has a balance of $700,000; Allowance for Doubtful Accounts has a credit balance of $5,500; and net sales for the year total $3,500,000. Bad debt expense is estimated at 1/2 of 1% of net sales.
Determine (a) the amount of the adjusting entry for bad debt expense; (b) the adjusted balances of Accounts Receivable, Allowance of Doubtful Accounts; and Bad Debt Expense; and (c) the net realizable value of accounts receivable.
Date of Note
Face Amount
Interest Rate
Term of Note
(1)
October 1
$21,000
8%
60 days
(2)
August 30
9,000
10
120 days
(3)
May 30
12,000
12
90 days
(4)
March 6
15,000
9
60 days
(5)
May 23
9,000
10
60 days
Explanation / Answer
Due Date = 29 Nov Interest = $277.96
Due Date = 27 Dec Interset = $300.76
Due Date = 27 Aug Interest = $360.3
DUe Date = 4 May Interest = $223.54
Due Date = 21 July Interest = $ 149.15
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