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In: Accounting

Problem 8-07A (Video) On January 1, 2020, Harter Company had Accounts Receivable $139,000, Notes Receivable $25,000,...

Problem 8-07A (Video)

On January 1, 2020, Harter Company had Accounts Receivable $139,000, Notes Receivable $25,000, and Allowance for Doubtful Accounts $13,200. The note receivable is from Willingham Company. It is a 4-month, 9% note dated December 31, 2019. Harter Company prepares financial statements annually at December 31. During the year, the following selected transactions occurred.

Jan. 5		Sold $20,000 of merchandise to Sheldon Company, terms n/15.
20		Accepted Sheldon Company’s $20,000, 3-month, 8% note for balance due.
Feb. 18		Sold $8,000 of merchandise to Patwary Company and accepted Patwary’s $8,000, 6-month, 9% note for the amount due.
Apr. 20		Collected Sheldon Company note in full.
30		Received payment in full from Willingham Company on the amount due.
May 25		Accepted Potter Inc.’s $6,000, 3-month, 7% note in settlement of a past-due balance on account.
Aug. 18		Received payment in full from Patwary Company on note due.
25		The Potter Inc. note was dishonored. Potter Inc. is not bankrupt; future payment is anticipated.
Sept. 1		Sold $12,000 of merchandise to Stanbrough Company and accepted a $12,000, 6-month, 10% note for the amount due.

Journalize the transactions. (Omit cost of goods sold entries.) (Round answers to 0 decimal places, e.g. 5,275. Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.)

Expert Solution

jan 5:- Sheldon company a/c dr. 20000$

To sales a/c 20000$

jan 20:- 8% Note receivable a/c dr $20000

To Sheldon company 20000$

feb 18:- Patwary company a/c dr $8000

To Sales a/c $8000

9% Note receivable a/c dr. $8000

To patwary company $8000

April 18:- Bank a/c dr $20000

To 8% Note receivable $20000

May 30:- Bank a/c Dr $25000

To Willingham Company $25000

7% note receivable a/c dr $6000

To Potter Inc. $6000

Aug 18: Bank a/c dr $8000

To 9% Note receivable a/c dr. $8000

Sep 1:-

Stanbrough Company a/c dr $12000

To sales $12000

10% Note Receivable a/c dr $12000

To Stanbrough Company $12000

ekkarill92 answered 2 years ago

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