Question

Sandhill Family Importers sold goods to Tung Decorators for $34,800 on November 1, 2020, accepting Tung’s $34,800, 6-month, 7% note. Prepare Sandhill’s November 1 entry, December 31 annual adjusting entry, and May 1 entry for the collection of the note and interest. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.)

Answer 1

Date	Accounts title and Explanation	Debit (in $)	Credit (in $)
01-Nov-20	Notes receivables	$34,800
	Sales Revenue		$34,800
	(To record the sales)
31-Dec-20	Interest receivable	$406
	Interest revenue                 [$34,800 x 7% x 2/12]		$406
	(To record the accrued interest )
01-May-21	Cash	$36,018
	Interest revenue               [$34,800 x 7% x 4/12]		$812
	Interest receivable		$406
	Notes receivables		$34,800
	(To record the collection of interest and note)