The following selected transactions occurred for Bleumortier Corporation. The company uses a perpetual inventory system, has a May 31 year end, and adjusts its accounts annually.
Feb. 1 Sold merchandise for $8,000 on account (n/30) to Morgan Ltd. The cost of goods sold was $6,000.
3 Sold $13,400 of merchandise costing $8,800 to Gauthier Company and accepted Gauthier's two-month, 6% note in payment. Interest is due at maturity.
26 Sold $12,000 of merchandise to Mathias Corp., terms n/30. The cost of the merchandise sold was $7,600.
Mar. 6 Sold on account $4,000 of merchandise that cost $3,000 to Superior Limited.
27 Accepted a two-month, 7%, $12,000 note from Mathias for the balance due. Interest is due at maturity. (See February 26 transaction.)
Apr. 3 Collected the Gauthier note in full. (See February 3 transaction.)
May 27 The Mathias note of March 27 was dishonoured. It is expected that Mathias will eventually pay the amount owed.
May 31 Recorded accrued interest for three months on outstanding interest on the receivable due from Morgan. Interest on unpaid receivables is charged at 24% per annum (2% per month). (See February 1 transaction.)
Instructions
Record the above transactions.