Sales and Notes Receivable Transactions The following were selected from among t

Question

Sales and Notes Receivable Transactions The following were selected from among the transactions completed during the current year by Danix Co., an appliance wholesale company: Jan. 13. Mar. 10, May 9. June 10. 15, 20, Sold merchandise on account to Black Tie Co., $37,200. The cost of goods sold was $22,320. Accepted a 60-day, 6% note for $.37,200 from Black Tie Co. on account. Received from Black Tie Co. the amount due on the note of March 10 Sold merchandise on account, terms 2/10, n/30, to Holen for $15,700. Record the sale net of the discount. The cost of goods sold was $9,420 Loaned $12,000 cash to Pioneer Co., receiving a 30-day, 8% note. Received from Holen the amount due on the invoice of June 10, less 2% discount. Received the interest due from Pioneer Co. and a new 60-day, 9% note as a renewal of the loan of June 15. (Record both the debit and the credit to the notes receivable account.) Received from Pioneer Co. the amount due on its note of July 15. Sold merchandise on account toWycoff Co., $40,000. The cost of goods sold was $24,000 Accepted a 60-day, 6% note for $40,000 from wycoff Co. on account. July 15 Sept. 13. 13. Oct. 12, Dec. 11 Wycoff Co. dishonored the note dated October 12 26. Received from Wycoff Co. the amount owed on the dishonored note, plus interest for 15 days at 12%, computed on the maturity value of the note. Required: Journalize the entries to record the transactions. Assume 360 days in a year. For a compound entry, if an amount box does not require an entry, leave it blank. Assume this is a year in which February has 28 days. Jan. 13-sale Jan. 13-cost Mar. 10 May 9 June 10-sale June 10-cost June 15 June 20

Explanation / Answer

Journal Entries :-

Date Particulars Debit($) Credit($) Jan 13 Accounts Receivable A/c Dr. 37200 To Sales A/c 37200 Jan 13 Cost of Merchandise Sold A/c Dr. 22320 To Merchandise Inventory A/c 22320 Mar 10 Notes Receivable A/c Dr. 37200 To Accounts Receivable A/c 37200 May 9 Cash A/c Dr. 37572 To Interest Revenue A/c ($37200*6%*(60/360)) 372 To Notes Receivable A/c 37200 June 10 Account Receivable A/c Dr. 15700 To Sales A/c 15700 June 10 Cost of Merchandise Sold A/c Dr. 9420 To Merchandise Inventory A/c 9420 June 15 Notes Receivable A/c Dr. 12000 To Cash A/c 12000 June 20 Cash A/c Dr. (Bal.) 15386 Sales Discount A/c Dr. ($15700*2%) 314 To Accounts Receivable A/c 15700 July 15 Notes Receivable A/c Dr. 12000 Cash A/c Dr. 80 To Interest Revenue A/c ($12000*8%*30/360) 80 To Notes Receivable A/c 12000 Sep. 13 Cash A/c Dr. 12180 To Interest Revenue A/c($12000*9%*60/360) 180 To Notes Receivable A/c 12000 Sep. 13 Accounts Receivable A/c Dr. 40000 To Sale A/c 40000 Sep. 13 Cost of Merchandise Sold A/c Dr. 24000 To Merchandise Inventory A/c 24000 Oct 12 Notes Receivable A/c Dr. 40000 To Accounts Receivable A/c 40000 Dec. 11 Accounts Receivable A/c Dr. 40200 To Interest Revenue A/c ($40000*6%*60/360) 200 To Notes Receivable A/c 40000 Dec. 26 Cash A/c Dr. 40401 To Interest Revenue A/c ($40200*12%*15/360) 201 To Notes Receivable A/c 40200

Related Questions

Navigate

• Browse (All)
• Browse S
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.