The following were selected from among the transactions completed by Caldemeyer

Question

The following were selected from among the transactions completed by Caldemeyer Co. during the current year. Caldemeyer Co. sells and installs home and business security systems. Jan. 3. Loaned $21,600 cash to Trina Gelhaus, receiving a 90-day, 8% note. Feb. 10. Sold merchandise on account to Bradford & Co., $18,600. The cost of the merchandise sold was $11,160. 13. Sold merchandise on account to Dry Creek Co., $61,200. The cost of merchandise sold was $55,080. Mar. 12. Accepted a 60-day, 6% note for $18,600 from Bradford & Co. on account. 14. Accepted a 60-day, 9% note for $61,200 from Dry Creek Co. on account. Apr. 3. Received the interest due from Trina Gelhaus and a new 120-day, 9% note as a renewal of the loan of January 3. (Record both the debit and the credit to the notes receivable account.) May 11. Received from Bradford & Co. the amount due on the note of March 12. 13. Dry Creek Co. dishonored its note dated March 14. July 12. Received from Dry Creek Co. the amount owed on the dishonored note, plus interest for 60 days at 12% computed on the maturity value of the note. Aug. 1. Received from Trina Gelhaus the amount due on her note of April 3. Oct. 5. Sold merchandise on account to Halloran Co., $13,900. The cost of the merchandise sold was $8,340. 15. Received from Halloran Co. the amount of the invoice of October 5, less 2% discount. Journalize the entries to record the transactions. Refer to the Chart of Accounts for exact wording of account titles.

Explanation / Answer

Particulars Debit Credit Jan-03 Loans & Advances 21600 Cash 21600 Loan to Trina) 90 day 8% Notes Receivable 21600 Loans & Advances 21600 (Loan converted to notes) Feb-10 Accounts Receivable(Bradford & Co) 18600 Sales 18600 (sales to Bradford Co) Cost of Goods sold 11160 Inventory 11160 (Cost of sales booked to inventory) Feb-13 Account receivable(Dry Creek & Co) 61200 Sales 61200 (sales to Dry Creek Co) Cost of Goods sold 55080 Inventory 55080 (Cost of sales booked to inventory) Mar-12 60 day 6% Notes Receivable 18600 Accounts Receivable 18600 (Bradford Co converted to Notes) Mar-14 60 day 9% Notes Receivable 61200 Accounts Receivable 61200 (Dry Creek converted to notes) Apr-03 Cash 432 Interest on 90 day 8% notes receivable 432 (Interest on notes from Trina) 120 day 9% notes receivable 21600 90 day 8% Notes Receivable 21600 (Conversion of note to new notes) May-11 Cash 18786 Interest on 60 day 6% notes recceivable 186 60 day 6% Notes Receivable 18600 (receipt on notes of Bradford Co) May-13 Allowance for Doubtful debts 62118 60 day 9% Notes Receivable 61200 Interest on 60 day 9% notes receivable 918 (Default by Dry creek Co) Jul-12 Accounts Receivable 62118 Allowance for Doubtful debts 62118 (Recovery from Dry Creek Co made due) Cash 63360.36 Interest on notes receivable written off 1242.36 Accounts Receivable 62118 (Receipt from Dry Creek) Aug-01 Cash 22248 120 day 9% notes receivable 21600 Interest on 120 day 9% notes receivable 648 (Received due amount from trnia) Oct-05 Accounts receivable (Halloran Co) 13900 Sales 13900 (Sales to Halloran Cco) Cost of Goods sold 8340 Inventory 8340 (Cost of sales booked to inventory) Oct-15 Cash 13622 Discount on sales 278 Accounts receivable (Halloran Co) 13900 (Cash received from halloran Co after discount)

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