Question

The following were selected from among the transactions completed during the current year by Danix Co., an appliance wholesale company:

Jan. 13.		Sold merchandise on account to Black Tie Co., $41,100. The cost of goods sold was $24,660.
Mar. 10.		Accepted a 60-day, 8% note for $41,100 from Black Tie Co. on account.
May 9.		Received from Black Tie Co. the amount due on the note of March 10.
June 10.		Sold merchandise on account, terms 2/10, n/30, to Holen for $14,900. Record the sale net of the discount. The cost of goods sold was $8,940.
15.		Loaned $18,000 cash to Pioneer Co., receiving a 30-day, 6% note.
20.		Received from Holen the amount due on the invoice of June 10, less 2% discount.
July 15.		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.)
Sept. 13.		Received from Pioneer Co. the amount due on its note of July 15.
13.		Sold merchandise on account toWycoff Co., $40,000. The cost of goods sold was $24,000.
Oct. 12.		Accepted a 60-day, 6% note for $40,000 from Wycoff Co. on account.
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.

Answer 1

Date	Accounting titles & Explanations				Debit	Credit
13-Jan	Accounts receivable-Black tie co				41,100
	sales					41,100
	cost of goods sold				24,660
	Merchandise inventory					24,660
10-Mar	Note receivable				41,100
	Accounts receivable-Black tie co					41,100
9-May	Cash				41,648
	interest revenue (41,100*8%*60/360)					548
	Note Receivable					41,100
10-Jun	Accounts receivable-holen				14,602
	Sales	(14,900*98%)				14,602
	cost of goods sold				8,940
	merchandises inventory					8,940
15-Jun	Note receivable -pioneer co				18,000
	cash					18,000
20-Jun	Cash				14,602
	Accounts receivable -Holen					14,602
15-Jul	9% note receivable				18,000
	cash				90
	interest revenue		(18000*6%*30/360)			90
	6% note receivable					18,000
13-Sep	cash				18,270
	interest revenue		(18000*9%*60/360)			270
	8% note receivable					18,000
13-Sep	Accounts receivable-wycoff				40,000
	sales					40,000
	cost of goods sold				24,000
	Merchandise inventory					24,000
12-Oct	Note receivable				40,000
	accounts receivable -wycoff					40,000
11-Dec	Account receivable				40,400
	interest revenue					400
	note receivable(40000*6%*60/360)					40,000
26-Dec	Cash				40,602
	interest revenue		(40400*12%*15/360)			202
	Account receivable					40,400