On December 31, 2014, Oakbrook Inc. rendered services to Beghun Corporation at a
ID: 2452733 • Letter: O
Question
On December 31, 2014, Oakbrook Inc. rendered services to Beghun Corporation at an agreed price of $111,829, accepting $44,400 down and agreeing to accept the balance in four equal installments of $22,200 receivable each December 31. An assumed interest rate of 12% is imputed.
Account Titles and Explanation
Debit
Credit
No.
Account Titles and Explanation
Debit
Credit
No.
Account Titles and Explanation
Debit
Credit
No.
Account Titles and Explanation
Debit
Credit
On December 31, 2014, Oakbrook Inc. rendered services to Beghun Corporation at an agreed price of $111,829, accepting $44,400 down and agreeing to accept the balance in four equal installments of $22,200 receivable each December 31. An assumed interest rate of 12% is imputed.
Explanation / Answer
Date
Accounts Titles & Explanation
Debit
Credit
Dec.31, 2014
Cash
44400
Beghun Corporation
44400
Cash
22200
Installment Receivables
22200
Dec.31, 2015
Cash
22200
Installment Receivables
22200
Installment Receivables
5427.48
Interest Income
5427.48
Dec.31,2016
Cash
22200
Installment Receivables
22200
Installment Receivables
3414.78
Interest Income
3414.78
Dec.31,2017
Cash
22200
Installment Receivables
22200
Installment Receivables
1184.55
Interest Income
1184.55
Date
Accounts Titles & Explanation
Debit
Credit
Dec.31, 2014
Cash
44400
Beghun Corporation
44400
Cash
22200
Installment Receivables
22200
Dec.31, 2015
Cash
22200
Installment Receivables
22200
Installment Receivables
5427.48
Interest Income
5427.48
Dec.31,2016
Cash
22200
Installment Receivables
22200
Installment Receivables
3414.78
Interest Income
3414.78
Dec.31,2017
Cash
22200
Installment Receivables
22200
Installment Receivables
1184.55
Interest Income
1184.55
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