Milton Company closes its books on its July 31 year-end. The company does not make entries...

Milton Company closes its books on its July 31 year-end. The company does not make entries to accrue for interest except at its year-end. On June 30, the Notes Receivable account balance is $23,800. Notes Receivable include the following.

date	Maker	Face Value	Term	Maturity Date	Interest Rate
April 21	Coote Inc	6,000	90 Days	July 20	8%
May 25	Brady Co	7,800	60 Days	July 24	10%
June 30	BMG Co	10,000	6 Months	December 31	6%

During July, the following transactions were completed.
July 5 Made sales of $4,500 on Milton credit cards.

14 Made sales of $600 on Visa credit cards. The credit card service charge is 3%.

20 Received payment in full from Coote Inc. on the amount due.
24 Received payment in full from Brady Co. on the amount due.

Instructions
(a) Journalize the July transactions and the July 31 adjusting entry for accrued interest receivable. (Interest is computed using 360 days; omit cost of goods sold entries.)

(b) Enter the balances at July 1 in the receivable accounts and post the entries to all of the
receivable accounts. (Use T-accounts.)

Solutions

Expert Solution

ekkarill92 answered 9 months ago

Next > < Previous

Related Solutions

Kingbird, Inc. closes its books on its July 31 year-end. The company does not make entries...

Kingbird, Inc. closes its books on its July 31 year-end. The company does not make entries to accrue for interest except at its year-end. On June 30, the Notes Receivable account balance is $ 26,600. Notes Receivable include the following. Date Maker Face Value Term Maturity Date Interest Rate April 21 Coote Inc. $ 5,600 90 days July 20 8% May 25 Brady Co. 9,000 60 days July 24 10% June 30 BMG Corp. 12,000 6 months December 31 8%...

Preparing Adjusting Journal Entries Pacific Company adjusts and closes its books each December 31. It is...

Preparing Adjusting Journal Entries Pacific Company adjusts and closes its books each December 31. It is now December 31, 2020, and the following information is available for preparing accounting adjustments. The Accounts Receivable balance at December 31 is $6,400. The company estimates that 5% of receivables will not be collected. (Assume a zero beginning balance in Allowance for Doubtful Accounts.) Unpaid and unrecorded salaries incurred at December 31 are $960. The company paid a two-year insurance premium in advance on...

Pronghorn Equipment Co. closes its books regularly on December 31, but at the end of 2017...

Pronghorn Equipment Co. closes its books regularly on December 31, but at the end of 2017 it held its cash book open so that a more favorable balance sheet could be prepared for credit purposes. Cash receipts and disbursements for the first 10 days of January were recorded as December transactions. The information is given below. 1. January cash receipts recorded in the December cash book totaled $53,800, of which $37,800 represents cash sales, and $16,000 represents collections on account...

Problem 7-1 Bonita Equipment Co. closes its books regularly on December 31, but at the end...

Problem 7-1 Bonita Equipment Co. closes its books regularly on December 31, but at the end of 2017 it held its cash book open so that a more favorable balance sheet could be prepared for credit purposes. Cash receipts and disbursements for the first 10 days of January were recorded as December transactions. The information is given below. 1. January cash receipts recorded in the December cash book totaled $49,100, of which $38,000 represents cash sales, and $11,100 represents collections...

In each of the following independent cases, the company closes its books on December 31. Windsor...

In each of the following independent cases, the company closes its books on December 31. Windsor Co. sells $511,000 of 10% bonds on March 1, 2020. The bonds pay interest on September 1 and March 1. The due date of the bonds is September 1, 2023. The bonds yield 12%. Give entries through December 31, 2021. Prepare a bond amortization schedule using the effective-interest method for discount and premium amortization. Amortize premium or discount on interest dates and at year-end....

In each of the following independent cases, the company closes its books on December 31. Bridgeport...

In each of the following independent cases, the company closes its books on December 31. Bridgeport Co. sells $491,000 of 8% bonds on March 1, 2017. The bonds pay interest on September 1 and March 1. The due date of the bonds is September 1, 2020. The bonds yield 12%. Prepare a bond amortization schedule using the effective-interest method for discount and premium amortization. Amortize premium or discount on interest dates and at year-end. (Round answers to 0 decimal places,...

Durhan Company closes its books on October 31. On September 30, the Notes Receivable account balance...

Durhan Company closes its books on October 31. On September 30, the Notes Receivable account balance is $22,800. Notes Receivable include the following. Date Maker Face Value Term Maturity Date Interest Rate Aug. 16 Stuhmer Inc. $10,000 60 days Oct. 15 6% Aug. 25 Moberg Co. 3,000 2 months Oct. 25 7% Sept. 30 Earnest Corp. 9,800 6 months Mar. 30 6% Interest is computed using a 360-day year. During October, the following transactions were completed. Oct. 7 Made sales...

Management Group, Inc., adjusts and closes its books each month. The trial balance at March 31,...

Management Group, Inc., adjusts and closes its books each month. The trial balance at March 31, 2017 before adjustments is as follows: Debit Credit Cash.......................................... 26,650 Accounts Receivable................. 30,000 Supplies..................................... 3,750 Prepaid Advertising................... 8,400 Equipment................................ 72,000 Accumulated Depreciation: Equipment 25,000 Unearned Consulting Fees............ 19,500 Capital Stock....................... 20,000 Retained Earnings................... 26,500 Consulting Fees Earned.............. 87,500 Salaries Expense.................... 32,000 Utilities Expense................... 1,200 Rent Expense........................ 4,500 _______ 178,500 178,500 ======= ======== The following information relates to month-end adjustments: a According to contracts, consulting...

The following year‐end account balances belong to Semiha Corporation for 2017. The company closes its accounting...

The following year‐end account balances belong to Semiha Corporation for 2017. The company closes its accounting books on 31 December each year, i.e. they operate on a 31 December year end. Assume that this is the end of the third year of the company’s operations. The account balances are as follows: Retained earnings (beginning of year 3, i.e. 2017) $42,000 Retained earnings (beginning of year 2, i.e. 2016) 23,000 Accounts receivable 11,000 Insurance expense 3,400 Salaries and wages expense 33,000...

The following year‐end account balances belong to Semiha Corporation for 2017. The company closes its accounting...

The following year‐end account balances belong to Semiha Corporation for 2017. The company closes its accounting books on 31 December each year, i.e. they operate on a 31 December year end. Assume that this is the end of the third year of the company’s operations. The account balances are as follows: Retained earnings (beginning of year 3, i.e. 2017) - $42,000 Retained earnings (beginning of year 2, i.e. 2016) - 23,000 Accounts receivable - 11,000 Insurance expense - 3,400 Salaries...

Subjects