Question

In: Accounting

The following selected transactions are from Ohlm Company: (Do not round intermediate calculations and round your...

The following selected transactions are from Ohlm Company: (Do not round intermediate calculations and round your final answers to nearest whole number. Use 360 days a year.)

2015

Dec. 16 Accepted a $12,400, 60-day, 9% note dated this day in granting Danny Todd a time extension on his past-due account receivable.
31 Made an adjusting entry to record the accrued interest on the Todd note.

2016

Feb. 14 Received Todd’s payment of principal and interest on the note dated December 16.
Mar. 2 Accepted a $6,200, 9%, 90-day note dated this day in granting a time extension on the past-due account receivable from Midnight Co.
17 Accepted a $3,700, 30-day, 7% note dated this day in granting Ava Privet a time extension on her past-due account receivable.
Apr. 16 Privet dishonored her note when presented for payment.
May 31 Midnight Co. refuses to pay the note that was due to Ohlm Co. on May 31. Prepare the journal entry to charge the dishonored note plus accrued interest to Midnight Co.'s accounts receivable.
July 16 Received payment from Midnight Co. for the maturity value of its dishonored note plus interest for 46 days beyond maturity at 9%.
Aug. 7 Accepted a $8,400, 90-day, 10% note dated this day in granting a time extension on the past-due account receivable of Mulan Co.
Sept. 3 Accepted a $3,370, 60-day, 11% note dated this day in granting Noah Carson a time extension on his past-due account receivable.
Nov. 2 Received payment of principal plus interest from Carson for the September 3 note.
Nov. 5 Received payment of principal plus interest from Mulan for the August 7 note.
Dec. 1 Wrote off the Privet account against Allowance for Doubtful Accounts.

  

Required:

1-a. First, complete the table below to calculate the interest amount at December 31.

          D.Todd Note - December 16, 2015

1-b. Use the calculated value to prepare your journal entries for 2015 transactions.

1-c. First, complete the table below to calculate the interest amounts.

1-d. Use those calculated values to prepare your journal entries for 2016 transactions.

Solutions

Expert Solution

OHLM COMPANY
General journal for the year 2015
Date Account Title Debit credit
Dec.16, 2015 Note Receivable 12400
Accounts Receivable 12400
(Note receivable for amount due from Danny Todd)
Dec.31, 2015 Interest Receivable 46.50
Interest Income 46.50
(Interest for 16 days on Danny Todd Note)
OHLM COMPANY
General journal for the year 2016
Date Account Title Debit credit
Feb.14, 2016 Cash 12586.00
Note Receivable 12400.00
Interest Receivable 46.50
Interest Income 139.50
(Cash received from Danny Todd on note receivable)
Mar.2,2016 Note Receivable 6200
Accounts Receivable 6200.00
(90-day, 9% Note received from Midnight Co. For the amount due)
Mar.17, 2016 Note Receivable 3700
Accounts Receivable 3700
(30-day , 7% Note received from Ava Privet for the amount due)
Apr.16,2016 Accounts Receivable 3700
Note Receivable 3700
(Note dishonoured by Ava Privet )
May.31, 2016 Accounts Receivable 6339.50
Note Receivable 6200.00
Interest Income 139.50
(Note receivable dishounoured by Midnight Co. Plus interest
     @9% for 90 days)
July.16,2016 Cash 6409.82
Accounts Receivable 6339.50
Interest Income 70.32
(Amount collected from Midnight Co. Along with interest due)
Aug.7, 2016 Note Receivable 8400
Accounts Receivable 8400
(90-day , 10% Note received from Mulan Co.)
Sept.3, 2016 Note Receivable 3370
Accounts Receivable 3370
(60-day , 11% note received from Noah Carson)
Nov.2, 2016 Cash 3431.78
Interest Income 61.78
Note Receivable 3370.00
(Amount collected from Noah Carson on note payable)
Nov.5, 2016 Cash 8610
Interest Income 210
Note Receivable 8400
(Amount collected from Mulan Co.along with interest)
Dec.1, 2016 Allowance for Doubtful accounts 3700
Accounts Receivable 3700
(Write off of amount due from Privet)

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