Question

	Prepare the necessary journal entries for the following transactions of Almez Co.
1-Dec	Almez Co. received a $20,000, 4 month, 6 % note from Drew Company in settlement of and
	account receivable.
31-Dec	Accrue interest
1-Apr	Almez Co. receives full payment on the Drew note.

	Compute bad debt expense based on the following information and prepare the resulting
	journal entries.
31-Dec	Kerr Company estimates that 6% of accounts receivable will become uncollectible.
	Accounts receivable are $120,000 at the end of the year, and the allowance for doubtful
	accounts has a credit balance of $1,500.
31-Dec	Use the same information as above except assume that the allowance for doubtful accounts
	has a debit balance of $200.

I need help with these two problems

Answer 1

No	Date	Accounts and Explanation	Debit	Credit
1	Dec 01	Notes Receivable	$20,000
		Accounts Receivable—Drew Co.		$20,000
		(To record notes receivable)
	Dec 31	Accrued Interest	$100
		Interest Revenue		$100
		(To record accrued interest)
	Apr 01	Cash	$20,400
		Interest Revenue		$300
		Accrued Interest		$100
		Notes Receivable		$20,000
		(To record receipt of notes receivable)
	Working
	Accrued interest on the notes receivable ($20,000 × 6% x 1/12) = $100
	Interest on the notes receivable ($20,000 × 6% x 3/12) = $300
2
	Dec 31	Bad Debt Expense	$5,700
		Allowance for Doubtful Accounts		$5,700
		($120,000 x 6%) – $1,500
	Dec 31	Bad Debt Expense	$7,400
		Allowance for Doubtful Accounts		$7,400
		($120,000 x 6%) + $200