Gehrig Co. closes its books monthly. On June 30, selected ledger account balances are: Notes Receivable ..........$60,000
Question:
Gehrig Co. closes its books monthly. On June 30, selected ledger account balances are:
Notes Receivable ..........$60,000
Interest Receivable ........ 435
Notes Receivable include the following.
During July, the following transactions were completed.
July 5 Made sales of $7,200 on Gehrig Co. credit cards.
14 Made sales of $1,300 on Visa credit cards. The credit card service charge is 3%.
14 Added $510 to Gehrig Co. credit card customer balances for finance charges on unpaid balances.
15 Received payment in full from Fulton Inc. on the amount due.
24 Received notice that the Ascot Co. note has been dishonored. (Assume that
Ascot Co. is expected to pay in the future.)
Instructions
(a) Journalize the July transactions and the July 31 adjusting entry for accrued interest receivable. (Interest is computed using 360 days.)
(b) Enter the balances at July 1 in the receivable accounts. Post the entries to all of the receivable accounts.
(c) Show the balance sheet presentation of the receivable accounts at July31.
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...
Step by Step Answer:
Financial and managerial accounting
ISBN: 978-1118016114
1st edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso