The following selected transactions occurred for Vu Ltd. The company uses a perpetual inventory system, has a September 30 year end, and adjusts its accounts annually.
Jan. 2 Lent Emily Collis, an employee, $10,000 on a four-month, 8% note. Interest is due at maturity.
5 Sold $11,000 of merchandise to Asiz Limited, terms n/15. The merchandise cost $6,700.
20 Accepted Asiz Limited's two-month, 9%, $11,000 note for its balance due. Interest is due each month on the 20th. (See January 5 transaction.)
Feb. 20 Collected interest on the Asiz note. (See January 20 transaction.)
Mar. 20 Collected the Asiz note in full. (See January 20 and February 20 transactions.)
May 2 Collected the Collis note in full. (See January 2 transaction.)
25 Accepted Thundercloud Inc.'s three-month, 8%, $3,000 note in settlement of a past-due balance on account. Interest is due at maturity.
Aug. 1 Pierpont Ltd. purchased merchandise on account for $6,000 (n/30). The goods had cost Vu $4,000.
25 The Thundercloud note was dishonoured. Eventual collection is not expected. (See May 25 transaction.)
Sept. 30 Recorded accrued interest for one month on outstanding receivable due from Pierpont. Interest on receivables is charged at 24% per annum (2% per month). (See August 1 transaction.)
Instructions
Record the above transactions.