Accounting for notes receivable, dishonored notes, and accrued interest revenue
Consider the following transactions for Rural Beginnings.
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2011 |
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Dec 6 |
Received a $4,000, 90 day, 9% note on account from AM Publishing. |
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31 |
Made an adjusting entry to accrue interest on the AM Publishing note. |
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31 |
Made a closing entry for interest revenue. |
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2012 |
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Mar 4 |
Collected the maturity value of the AM Publishing note. |
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Jun 30 |
Loaned $15,000 cash to Johnathon’s Publishing, receiving a six month, 8% note. |
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Oct 2 |
Received a $2,000, 60 day, 8% note for a sale to Ying Yang Music. Ignore cost of goods sold. |
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Dec 1 |
Ying Yang Music dishonored its note at maturity; wrote off the note as uncollectible, debiting Allowance for uncollectible accounts. |
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30 |
Collected the maturity value of the Johnathon’s Publishing note. |
Requirement
1. Journalize all transactions for Rural Beginnings. Round all amounts to the nearest dollar. (For notes stated in days, use a 360 day year.)