Date 1)april 4 2)june 26 3)july 5 4)oct 31 5)nov 23 6)dec 27 Face Amount 1)$30,0

Question

Date             1)april 4     2)june 26    3)july 5       4)oct 31     5)nov 23      6)dec 27

Face Amount 1)$30,000   2)18,000    3)16,200      4)36,000    5)21,000      6)40,500

Term             1)60 days   2)30 Days   3) 120 days   4)60 days    5)60 days      6)30 days

Intrest Rate   1)8%          2)12%         3)6%              4)9%          5)6%              6)12%

Instructions

1) Determine for each (a) the Due Date and (b) the amount of interest due at maturity, identifying each note by number

2) journalize the entry to record the dishonor of note (3) on its due date.

3) Journalize the adjusting entry to record the accrued interest on Notes (5) and (6) on december 31

4) Journalize the entries to record the receipt of the amounts due on Notes (5) and (6) in January.

Explanation / Answer

Date 4-Apr 26-Jun 5-Jul 31-Oct 23-Nov 27-Dec Face Value 30000 18000 16200 36000 21000 40500 Term Days 60 30 120 60 60 30 Interest Rate 8% 12% 6% 9% 6% 12% Due Date 3-Jun 26-Jul 2-Nov 31-Dec 22-Jan 27-Jan Interest Earned 400 180 324 540 210 405 2 31-Dec Accounts Receivable 16524 Notes Receivable 16200 Interest Earned 324 3 31-Dec Interest Receivable 145.5 Interest Revenue 145.5 ( To record interest accrued on Note 5 :210/2=105 &Note 6 :405/10=40.5) 4 22-Jan Cash 21210 Notes Receivable 21000 Interest Receivable 105 Interst Revenue 105 27-Jan Cash 40905 Notes Receivable 40500 Interest Receivable 40.5 Interst Revenue 364.5

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