Problem 7-7 ng machine to Valco B rothers Farm, Inc. In lieu of a cash payment V
ID: 2548646 • Letter: P
Question
Problem 7-7 ng machine to Valco B rothers Farm, Inc. In lieu of a cash payment Valco Avied r Eeuamet Company sold a pecan-harvesting machine to Valco Brothers Farm, Inc. in lieu of a cash payment Valco anonualiy on oetober . Windsor's financal statemts prepared on a aleterest for a node of this type). The note required interest to be paid Assuming Valco Brothers Farm fulfils all the terms of the note, prepare the necessary journal entries for Windsor Equpmen tries in the rdr term of the note. Assume that reversing entries are not made on January 1, 2018 and January 1, 2019. (Record journal entries in the order presented in the problem. If no entry is required, select "No Entry" for the account titles and enter o fort titles are automatically indented when the amount is entered. Do not indent manually) he amounts. Credit accountExplanation / Answer
Answer:
Date
Account title and Explanation
Debit $
Credit $
10/1/2017
Notes receivable
128000
Sales revenue
128000
12/31/2017
Interest receivable
2560
Interest revenue
2560
(128000*8%*3/12)
10/1/2018
Cash (128000*8%)
10240
Interest receivable
2560
Interest revenue
7680
(to record the collection of interest)
12/31/2018
Interest receivable
2560
Interest revenue
2560
(128000*8%*3/12)
10/1/2019
Cash (128000*8%)
10240
Interest receivable
2560
Interest revenue
7680
(to record the collection of interest)
Date
Account title and Explanation
Debit $
Credit $
10/1/2017
Notes receivable
128000
Sales revenue
128000
12/31/2017
Interest receivable
2560
Interest revenue
2560
(128000*8%*3/12)
10/1/2018
Cash (128000*8%)
10240
Interest receivable
2560
Interest revenue
7680
(to record the collection of interest)
12/31/2018
Interest receivable
2560
Interest revenue
2560
(128000*8%*3/12)
10/1/2019
Cash (128000*8%)
10240
Interest receivable
2560
Interest revenue
7680
(to record the collection of interest)