Question

Comfy Recliner Chairs completed the following selected transactions:
2016
Jul. 1 Sold merchandise inventory to Gray Mart, receiving a $43,000, nine-month, 12% note. Ignore Cost of Goods Sold.
Oct. 31 Recorded credit and debit card sales for the period of $21,000. Use the gross method. Ignore Cost of Goods Sold.
Nov. 3 Card processor drafted company's checking account for processing fee of $400.
Dec. 31 Made an adjusting entry to accrue interest on the Gray Mart note.
31 Made an adjusting entry to record bad debts expense based on an aging of accounts receivable. The aging schedule shows that $14,600 of accounts receivable will not be collected. Prior to this adjustment, the credit balance in Allowance for Bad Debts is $10,700.
2017
Apr. 1 Collected the maturity value of the Gray Mart note.
Jun. 23 Sold merchandise inventory to Aglow, Corp., receiving a 60-day, 9% note for $13,000. Ignore Cost of Goods Sold.
Aug. 22 Aglow, Corp. dishonored its note at maturity; the business converted the maturity value of the note to an account receivable.
Nov. 16 Loaned $22,000 cash to Crowe, Inc., receiving a 90-day, 16% note.
Dec. 5 Collected in full on account from Aglow, Corp.
31 Accrued the interest on the Crowe, Inc. note.
Record the transactions in the journal of Comfy Recliner Chairs. Explanations are not required.


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  • CreatedJune 15, 2015
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