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In: Accounting
Water Closet Co. wholesales bathroom fixtures. During the current year ending December 31, Water Closet received...
Water Closet Co. wholesales bathroom fixtures. During the current year ending December 31, Water Closet received the following notes:
|
Date |
Face Amount |
Term |
Interest Rate |
|
| 1. | Mar. 6 | $75,000 | 60 days | 6% |
| 2. | Apr. 7 | 40,000 | 45 days | 10% |
| 3. | Aug. 12 | 36,000 | 120 days | 5% |
| 4. | Oct. 22 | 27,000 | 30 days | 6% |
| 5. | Nov. 19 | 48,000 | 90 days | 3% |
| 6. | Dec. 15 | 72,000 | 45 days | 4% |
| Required: | |
| 1. | Determine for each note (a) the due date and (b) the amount of interest due at maturity, identifying each note by number. Assume a 360-day year. (Note: Round each interest computation to the nearest cent.) |
| 2. | Journalize the entry to record the dishonor of Note (3) on its due date. Refer to the Chart of Accounts for exact wording of account titles. |
| 3. | Journalize the adjusting entry to record the accrued interest on Notes (5) and (6) on December 31. Refer to the Chart of Accounts for exact wording of account titles. Assume a 360-day year. (Note: Round each interest computation to the nearest cent.) |
| 4. | Journalize the entries to record the receipt of the amounts due on Notes (5) and (6) in January and February. Refer to the Chart of Accounts for exact wording of account titles. |
Solutions
Expert Solution
| 1a)Determination of Due dates of the given notes | ||||||
| Note | ||||||
| 1 | Month | Note Issued date | Days in Month | Days note was issued | Cumulative Days | Due date |
| March | 6 | 31 | 25 | 25 | ||
| April | 30 | 30 | 55 | |||
| May | 31 | 5 | 60 | May-05 | ||
| 2 | Month | Note Issued date | Days in Month | Days note was issued | Cumulative Days | Due date |
| April | 7 | 30 | 23 | 23 | ||
| May | 31 | 22 | 45 | May-22 | ||
| 3 | Month | Note Issued date | Days in Month | Days note was issued | Cumulative Days | Due date |
| August | 12 | 31 | 19 | 19 | ||
| September | 30 | 30 | 49 | |||
| October | 31 | 31 | 80 | |||
| November | 30 | 30 | 110 | |||
| December | 31 | 10 | 120 | Dec-10 | ||
| 4 | Month | Note Issued date | Days in Month | Days note was issued | Cumulative Days | Due date |
| October | 22 | 31 | 9 | 9 | ||
| November | 30 | 21 | 30 | Nov-21 | ||
| 5 | Month | Note Issued date | Days in Month | Days note was issued | Cumulative Days | Due date |
| November | 19 | 30 | 11 | 11 | ||
| December | 31 | 31 | 42 | |||
| January | 31 | 31 | 73 | |||
| February | 28 | 17 | 90 | Feb-17 | ||
| 6 | Month | Note Issued date | Days in Month | Days note was issued | Cumulative Days | Due date |
| December | 15 | 31 | 16 | 16 | ||
| January | 31 | 29 | 45 | Jan-29 |
| 1b) Determination of Interest amount(Assuming 360 days a year | ||||||
| Note | Date of Note | Face Amount | Interest Rate | Term of Note (in days) | Days in year | Interest Amount |
| 1 | Mar-06 | 75,000 | 6% | 60 days | 360 | 750 |
| 2 | Apr-07 | 40,000 | 10% | 45 days | 360 | 500 |
| 3 | Aug-12 | 36,000 | 5% | 120 days | 360 | 600 |
| 4 | Oct-22 | 27,000 | 6% | 30 days | 360 | 135 |
| 5 | Nov-19 | 48,000 | 3% | 90 days | 360 | 360 |
| 6 | Dec-15 | 72,000 | 4% | 45 days | 360 | 360 |
| 2. Journal Entry to record the dishonor of Note (3) on its due date | |||
| General Journal | |||
| Date | Account s Title and explanation | Debit ($) | Credit ($) |
| Dec- 10 | Account Receivable | $36,600 | |
| Interest Revenue (36,000*5%*120/360) | $600 | ||
| Note Receivable | $36,000 | ||
| (To record the dishonour of Note (3)) | |||
| 3. Journal Entry to record the adjusting entry of accrued interest on Note (5) and Note (6) | |||
| General Journal | |||
| Date | Account s Title and explanation | Debit ($) | Credit ($) |
| Dec- 31 | Interest Receivable | $296 | |
| Interest Revenue | $296 | ||
| (To recrd accrued interest earned) | |||
|
$48,000 * 3% * 42/360 = 168 and $72,000 * 4% * 16/360 = 128 |
|||
| 4. Journal Entry to record the receipts due on Note (5) and (6) | |||
| General Journal | |||
| Date | Account s Title and explanation | Debit ($) | Credit ($) |
| Jan-29 | Cash | $72,360 | |
| Interest Revenue (72,000*4%*29/360) | $232 | ||
&n
 ekkarill92 answered 2 hours agoRelated SolutionsWater Closet Co. wholesales bathroom fixtures. During the current year ending December 31, Water Closet received...Water Closet Co. wholesales bathroom fixtures. During the
current year ending December 31, Water Closet received the
following notes:
Date
Face Amount
Term
Interest Rate
1.
Mar. 6
$75,000
60 days
4%
2.
Apr. 7
40,000
45 days
6%
3.
Aug. 12
36,000
120 days
5%
4.
Oct. 22
27,000
30 days
8%
5.
Nov. 19
48,000
90 days
3%
6.
Dec. 15
72,000
45 days
5%
JOURNAL
ACCOUNTING EQUATION
Score: 91/99
DATE
DESCRIPTION
POST. REF.
DEBIT
CREDIT
1
Jan....
Details of notes receivable and related entries Water Closet Co. wholesales bathroom fixtures. During the current...Details of notes receivable and related entries
Water Closet Co. wholesales bathroom fixtures. During the
current year ending December 31, Water Closet received the
following notes:
Date
Face Amount
Term
Interest Rate
1.
Mar. 6
$75,000
60 days
2%
2.
Apr. 7
40,000
45 days
9%
3.
Aug. 12
36,000
120 days
5%
4.
Oct. 22
27,000
30 days
8%
5.
Nov. 19
48,000
90 days
9%
6.
Dec. 15
72,000
45 days
5%
Required:
1.
Determine for each note...
Flush Mate Co. wholesales bathroom fixtures. During the current fiscal year, Flush Mate Co. received the...Flush Mate Co. wholesales bathroom fixtures. During the current
fiscal year, Flush Mate Co. received the following notes:
Date
Face Amount
Interest Rate
Term
1.
Mar. 6
$78,000
4%
45 days
2.
Apr. 23
24,500
9
60 days
3.
July 20
45,900
5
120 days
4.
Sept. 6
58,700
6
90 days
5.
Nov. 29
27,400
7
60 days
6.
Dec. 30
67,500
6
30 days
Required:
4.
Journalize the entries to record the receipt of the amounts due
on...
Flush Mate Co. wholesales bathroom fixtures. During the current fiscal year, Flush Mate Co. received the...Flush Mate Co. wholesales bathroom fixtures. During the current
fiscal year, Flush Mate Co. received the following notes:
Date
Face Amount
Interest Rate
Term
1.
Mar. 6
$82,000
6%
45 days
2.
Apr. 23
28,900
10
60 days
3.
July 20
41,400
7
120 days
4.
Sept. 6
49,700
7
90 days
5.
Nov. 29
26,300
5
60 days
6.
Dec. 30
72,000
6
30 days
Required:
1. Determine for each note (a) the due date and (b) the amount...
Flush Mate Co. wholesales bathroom fixtures. During the current fiscal year, Flush Mate Co. received the...Flush Mate Co. wholesales bathroom fixtures. During the current
fiscal year, Flush Mate Co. received the following notes:
Date
Face Amount
Interest Rate
Term
1.
Mar. 6
$78,600
5%
45 days
2.
Apr. 23
25,600
8
60 days
3.
July 20
37,100
6
120 days
4.
Sept. 6
49,600
7
90 days
5.
Nov. 29
30,700
6
60 days
6.
Dec. 30
68,600
6
30 days
Required:
1.
Determine for each note (a) the due date and (b) the amount...
Flush Mate Co. wholesales bathroom fixtures. During the current fiscal year, Flush Mate Co. received the...Flush Mate Co. wholesales bathroom fixtures. During the current
fiscal year, Flush Mate Co. received the following notes:
Date
Face
Amount
Interest Rate
Term
1.
Mar. 6
$75,300
5%
45
days
2.
Apr. 23
24,500
9%
60
days
3.
July 20
41,600
5%
120
days
4.
Sept. 6
55,400
6%
90
days
5.
Nov. 29
24,100
7%
60
days
6.
Dec. 30
67,400
6%
30
days
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1.
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S
0...
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The stock was issued for cash.
The...
Carla Corporation had a net income for the current year ending December 31, 2021 of $1,204,500....Carla Corporation had a net income for the current year ending
December 31, 2021 of $1,204,500. Throughout 2021 the following
items were outstanding:
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413,000 common shares
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18,500 Class A $3 cumulative preferred shares that were
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