Date Account Titles and Explanation Debit Credit SHOW LIST OF ACCOUNTS Date Acco

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Account Titles and Explanation

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SHOW LIST OF ACCOUNTS

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Account Titles and Explanation

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Elburn Supply Co. has the following transactions related to notes receivable during the last 2 months of 2017. The company does not make entries to accrue interest except at December 31.
Nov. 1 Loaned $27,000 cash to Manny Lopez on a 12-month, 10% note. Dec. 11 Sold goods to Ralph Kremer, Inc., receiving a $74,250, 90-day, 8% note. 16 Received a $95,400, 180 day, 8% note in exchange for Joe Fernetti’s outstanding accounts receivable. 31 Accrued interest revenue on all notes receivable.

Explanation / Answer

Journal entry ;

Record the collection of the Lopez note at its maturity in 2018. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Use 360 days for calculation.)

date accounts & explanation debit credit Nov 1 Notes receivable a/c 27000 Cash a/c 27000 (To record loan to  Manny Lopez) Dec 11 Notes receivable a/c 74250 Sales revenue a/c 74250 (To record sales) Dec 16 Notes receivable 95400 Account receivable a/c 95400 (To record exchange with account receivable) Dec 31 Interest receivable a/c 1098 Interest revenue a/c 1098 (To record interest receivable)

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