In: Accounting
The following were selected from among the transactions completed during the current year by Danix Co., an appliance wholesale company:
Jan. 21. | Sold merchandise on account to Black Tie Co., $41,400. The cost of merchandise sold was $24,840. | |
Mar. 18. | Accepted a 60-day, 9% note for $41,400 from Black Tie Co. on account. | |
May 17. | Received from Black Tie Co. the amount due on the note of March 18. | |
June 15. | Sold merchandise on account to Pioneer Co. for $17,900. The cost of merchandise sold was $10,740. | |
21. | Loaned $24,000 cash to JR Stutts, receiving a 30-day, 6% note. | |
25. | Received from Pioneer Co. the amount due on the invoice of June 15. | |
July 21. | Received the interest due from JR Stutts and a new 60-day, 8% note as a renewal of the loan of June 21. (Record both the debit and the credit to the notes receivable account.) | |
Sept. 19. | Received from JR Stutts the amount due on her note of July 21. | |
22. | Sold merchandise on account to Wycoff Co., $40,000. The cost of merchandise sold was $24,000. | |
Oct. 14. | Accepted a 60-day, 6% note for $40,000 from Wycoff Co. on account. | |
Nov. 13. | Wycoff Co. dishonored the note dated October 14. | |
Dec. 28. | 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.
Journal Entries | |||
Date | Account Title and explanation | Debit | Credit |
Jan, 21 | Black Tie Co. | $ 41,400.00 | |
To Sales | $ 41,400.00 | ||
Cost of Goods Sold | $ 24,840.00 | ||
Jan, 21 | To Merchandise | $ 24,840.00 | |
9% Note | $ 41,400.00 | ||
Mar, 18 | To Black Tie Co. | ||
May, 17 | Pioneer Co. | $ 17,900.00 | |
To Sales | $ 17,900.00 | ||
Cost of Goods Sold | $ 10,740.00 | ||
June, 15 | To Merchandise | $ 10,740.00 | |
6 % Note | $ 24,000.00 | ||
June, 21 | To Cash | $ 24,000.00 | |
June, 25 | Cash | $ 17,900.00 | |
To Pioneer Co. | $ 17,900.00 | ||
July , 21 | Cash ($ 24,000 X 6% $30/360) | $ 120.00 | |
To Interest Revenue | $ 120.00 | ||
July , 21 | 8% Note | $ 24,000.00 | |
To 6% Note | $ 24,000.00 | ||
Sept, 19 | Cash | $ 24,320.00 | |
To 8% Note | $ 24,000.00 | ||
To Interest Revenue ( $ 24,000 X 8% X 60/360) | $ 320.00 | ||
Sept, 22 | Wycoff | $ 40,000.00 | |
To Sales | $ 40,000.00 | ||
Cost of Goods Sold | $ 24,000.00 | ||
Sept, 22 | To Merchandise | $ 24,000.00 | |
6% Note | $ 40,000.00 | ||
Oct, 14 | To Wycoff | $ 40,000.00 | |
Nov, 14 | Wycoff | $ 40,400.00 | |
To 6% interest | $ 40,000.00 | ||
To interest revenue | $ 400.00 | ||
Dec, 28 | Cash | $ 40,602.00 | |
To Wycoff | $ 40,400.00 | ||
To interest revenue($ 40,400 X 12% X 15/360) | $ 202.00 | ||