Accompanying a bank statement for Santee Company is a credit memo for $15,120 re
ID: 2487605 • Letter: A
Question
Accompanying a bank statement for Santee Company is a credit memo for $15,120 representing the principal ($14,000) and interest ($1,120) on a note that had been collected by the bank. The company had been notified by the bank at the time of the collection but had made no entries.
On March 1, journalize the entry that should be made by the company to bring the accounting records up to date. Refer to the Chart of Accounts for exact wording of account titles.
CHART OF ACCOUNTSSantee CompanyGeneral Ledger
Interest Expense
On March 1, journalize the entry that should be made by the company to bring the accounting records up to date. Refer to the Chart of Accounts for exact wording of account titles.
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JOURNAL
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ASSETS 110 Cash 111 Petty Cash 120 Accounts Receivable 131 Notes Receivable 141 Merchandise Inventory 145 Office Supplies 146 Store Supplies 151 Prepaid Insurance 181 Land 191 Office Equipment 192 Accumulated Depreciation-Office Equipment 193 Store Equipment 194 Accumulated Depreciation-Store EquipmentExplanation / Answer
DATE DESCRIPTION DEBIT CREDIT 1 1-Mar Cash 15,120 2 Notes Receivable 14,000 3 Interest Revenue 1,120