Can you please show answers with calculations? Elburn Supply Co. has the followi
ID: 2452879 • Letter: C
Question
Can you please show answers with calculations?
Elburn Supply Co. has the following transactions related to notes receivable during the last 2 months of 2013. The company does not make entries to accrue interest except at December 31.
Nov. 1
Loaned $18,500 cash to Manny Lopez on a 12-month, 12% note.
Dec. 11
Sold goods to Ralph Kremer, Inc., receiving a $46,800, 90-day, 10% note.
16
Received a $58,560, 180 day, 10% note in exchange for Joe Fernetti’s outstanding accounts receivable.
31
Accrued interest revenue on all notes
1) Journalize the transactions for Elburn Supply Co. (Record journal entries in the order presented in the problem. Credit account titles are automatically indented when amount is entered. Do not indent manually. Use 360 days for calculation. Round answers to 0 decimal places, e.g. 5,275.) receivable.
2) Record the collection of the Lopez note at its maturity in 2014. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Use 360 days for calculation.)
Explanation / Answer
Calculation of interest recievable on december
18,500 @12% *2/12 = $370
Second note= $46,800 @ 10% * 21/360 = $273
$58,560 @10% *15/180 = $244
Jouranl entry
Journal entries for 2015
Interest income
(46,800@10% *69/360)
to interest income 1,850
To notes recievable $18,500
( 18500 @12% *10/12)
Date Description Debit Credit Nov 1 Notes recievable $18,500 To cash $18,500 Dec 11 Notes recievable $46,800 to Sales $46,800