Oxford company, equipment manufacturer, sold equipment costing $42,000 to Conlin services in exchange for a zero-interest...

Oxford company, equipment manufacturer, sold equipment costing $42,000 to Conlin services in exchange for a zero-interest bearing note with a face value of $52,000 on july 1, with payment due in 12 months. The fair value of the equipment on the date of sale was $46,000. Oxford has a calendar year reporting period.

Instructions

Journalize all entries for Oxford company

Expert Solution

	Account Titles	Debit	Credit
Jul-01	Notes Receivable	$ 52,000
	Discount on Notes Receivable		$ 6,000
	Sales Revenue		$ 46,000

	Cost of Goods Sold	$ 42,000
	Inventory		$ 42,000

Dec-31	Discount on Notes Receivable	$ 3,000
	Interest Revenue		$ 3,000

Jul-01	Discount on Notes Receivable	$ 3,000
	Interest Revenue		$ 3,000

	Cash	$ 52,000
	Notes Receivable		$ 52,000

Assuming Cash Received on due date

ekkarill92 answered 3 years ago

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