Question

Sales and Notes Receivable Transactions

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., $29,400. The cost of merchandise sold was $17,640.
Mar. 18.		Accepted a 60-day, 6% note for $29,400 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 $12,300. The cost of merchandise sold was $7,380.
21.		Loaned $12,000 cash to JR Stutts, receiving a 30-day, 8% 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, 9% 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., $20,000. The cost of merchandise sold was $12,000.
Oct. 14.		Accepted a 60-day, 6% note for $20,000 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.

Jan. 21-sale
Jan. 21-cost
Mar. 18
May 17
June 15-sale
June 15-cost
June 21
June 25
July 21
Sept. 19- note
Sept. 22-sale
Sept. 22-cost
Oct. 14
Nov. 13
Dec. 28

Answer 1

Date	Account Description	Debit	Credit
21-Jan	Black Tie Co	29,400.00
	To Sales		29,400.00
	(Being Goods Sold)
21-Jan	Cost of Goods Sold	17,640.00
	Purchases		17,640.00
	(Being cost of goods transferred from purchases)
18-Mar	6% Note	29,400.00
	Black Tie Co		29,400.00
	(Being 6 % note received against Dues)
17-May	Cash	29,694.00
	6% Note		29,400.00
	To Interest Revenue		294.00
	(Being payment Received from Black Tie Co.)
15-Jun	Pioneer Co	12,300.00
	To Sales		12,300.00
	(Being Goods Sold)
15-Jun	Cost of Goods Sold	7,380.00
	Purchases		7,380.00
	(Being cost of goods transferred from purchases)
21-Jun	8% Note	12,000.00
	Cash		12,000.00
	(Being Loaned $12,000 cash to JR Stutts)
25-Jun	Cash	12,300.00
	Pioneer Co		12,300.00
	(Being Received from Pioneer Co. the amount due on the invoice)
21-Jul	Cash	80.00
	9% Note	12,000.00
	8% Note		12,000.00
	Interest Revenue		80.00
	(Being New Note issued to JR Stutts and Interest Received on old Note)
19-Sep	Cash	12,180.00
	9% Note		12,000.00
	Interest Revenue		180.00
	(Received from JR Stutts)
22-Sep	Wycoff Co	20,000.00
	Sales		20,000.00
	(Being Goods Sold)
22-Sep	Cost of Goods Sold	12,000.00
	Purchases		12,000.00
	(Being cost of goods transferred from purchases)
14-Oct	6% Note	20,000.00
	Wycoff Co		20,000.00
	(Being Note Received Against Dues)
13-Nov	Wycoff Co	20,200.00
	6% Note		20,000.00
	Interest Revenue		200.00
	(Being Wycoff Co. dishonoured the note dated October 14)
28-Dec	Cash	20,301.00
	Wycoff Co		20,200.00
	Interest Revenue		101.00
	Being Received from Wycoff Co. the amount owed on the dishonoured note plus Interest)