Prepare journal entries to record the following transactions entered into by the
ID: 2389839 • Letter: P
Question
Prepare journal entries to record the following transactions entered into by the Merando Company:
2009
June 1 Received a $7,000, 6%, 1-year note from Dan Gore as full payment on his account.
Nov. 1 Sold merchandise on account to Barlow, Inc., for $9,000, terms 2/10, n/30.
Nov. 5 Barlow, Inc., returned merchandise worth $1,000.
Nov. 9 Received payment in full from Barlow, Inc.
Dec. 31 Accrued interest on Gore's note.
2010
June 1 Dan Gore honored his promissory note by sending the face amount plus interest.
Explanation / Answer
2009
June 1 Received a $7,000, 6%, 1-year note from Dan Gore as full payment on his account.
Notes receivables---Dr---7000
Accounts receivables--Cr---7000
Nov. 1 Sold merchandise on account to Barlow, Inc., for $9,000, terms 2/10, n/30.
Accounts receivables—Dr—9000
Sales -----------------------------------Cr---9000
Nov. 5 Barlow, Inc., returned merchandise worth $1,000.
Return inwards---Dr—1000
Accounts receivables---Cr----1000
Nov. 9 Received payment in full from Barlow, Inc
9000*2% = 180
Cash---Dr—9180
Interest revenue ---Cr----180
Accounts receivables—Cr---9000
Dec. 31 Accrued interest on Gore's note.
7000*6% = 420
Interest recivables—Dr—420
Cash---Dr—7420
Interest revenue ---Cr----420
Accounts receivables—Cr---7000