April Ltd. reported various selected balances in its 31 December 20X7 unadjusted trial balance:

Accounts receivable	$1,820,000	dr.
Special accounts receivable	229,000	dr.
Accounts receivableU.S.	116,000	dr.
Allowance for doubtful accounts	160,150	cr.
Allowance for sales discounts	45,500	cr.

The following transactions and events are noted:

1.	An analysis of accounts receivable indicates that $820,000 are still in the discount period. An allowance of $82,000 is needed for sales discounts.
2.	An analysis of accounts receivable indicated that $200,000 of accounts receivable should be written off. Of the remaining balance, 80% was current, and, after the allowance for sales discounts, approximately 5% was deemed doubtful. Of the 20% noncurrent, 75% was doubtful.
3.	The U.S. account receivable was recorded when the exchange rate was $1.16. The exchange rate at year-end was $1.14.
4.	The special account receivable was a single account receivable from a customer with an excellent credit rating that was transferred to a financial institution at a discount rate of 4% during the period. The cash collected from the financial institution was credited to an account called Miscellaneous credits. Management has determined that this transaction was to be recorded as a sale/derecognition but has not yet made the necessary entry.
5.	The company has a note receivable that has not yet been recorded. The note is a $72,000, three-year note that bears an interest rate of 4%. Interest is paid annually. The note was issued on 1 November 20X7 because of a sale. The market interest rate for accounts of this risk is 8%.

View transaction list View journal entry worksheet NO Transaction General Journal Debit Credit 1 01 36.500 Sales discounts Allowance for sales discounts 36.500 2 02(a) Allowance for doubtful accounts 200.000 Accounts receivable 200.000 3 02(b) 340.330 Bad debt expense Allowance for doubtful accounts 340,330 4 03 2.000 Exchange loss Special accounts receivable 2,000 5 Miscellaneous credits 219.840 9.160 Financing expense Special accounts receivable 229.000 6 05(a) Notes receivable 72.000 7.462 Discount on notes receivable Sales 84,538 7 05(b) Interest receivable Discount on notes receivable Interest revenue 480 380 860