E8-12 Vandiver Company had the following select transactions Apr. 1, 2015 Accept

Question

E8-12 Vandiver Company had the following select transactions Apr. 1, 2015 Accepted Goodwin Companys 12-month, 12% note in settlement of a $30,000 account receivable. July 1, 2015 Loaned $25,000 cash to Thomas Slocombe on a 9-month, 10% note. Dec. 31, 2015 Accrued interest on all notes receivable. Apr. 1, 2016 Received principal plus interest on the Goodwin note. Apr. 1, 2016 Thomas Slocombe dishonored its note; Vandiver exp ects it will eventually Instructions Prepare journal entries to record the t once a year on December 31

Explanation / Answer

04-01-2015 Notes Receivable 30000        Accounts Receivable—Goodwin 30000 07-01-2015 Notes Receivable 25000        Cash 25000 13/21/15 Interest Receivable 2700 =30000*12%/12*9       Interest Revenue 2700 Interest Receivable 1250 =25000*10%/12*6       Interest Revenue 1250 04-01-2016 Cash 33600        Notes Receivable 30000         Interest Receivable 2700       Interest Revenue 900 =30000*12%/12*3 Accounts Receivable 26875        Notes Receivable 25000         Interest Receivable 1250         Interest Revenue 625 =25000*10%/12*3

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