Question
The following transactions are from Ohlm Company. (Use 360 days a year.) Year 1 Dec. 16...
The following transactions are from Ohlm Company. (Use 360 days a year.) Year 1 Dec. 16 Accepted a $12,000, 60-day, 18% note in granting Danny Todd a time extension on his past-due account receivable. 31 Made an adjusting entry to record the accrued interest on the Todd note. Year 2 Feb. 14 Received Todd's payment of principal and interest on the note dated December 16. Mar. 2 Accepted a(n) 56,909, 10%, 90-day note in granting a time extension on the past-due account receivable from Midnight Co. 17 Accepted a(n) $2,600, 30-day, 7% note in granting Ava Privet a time extension on her past due account receivable. Apr. 16 Privet dishonored her note. May 31 Midnight Co. dishonored its note. Aug. 7 Accepted a(n) $8,100, 90-day, 11% note in granting a time extension on the past due account receivable of Mulan Co. Sep. 3 Accepted a(n) $2,170, 60-day, 10% note in granting Noah Carson a time extension on his past due account receivable. Nov. 2 Received payment of principal plus interest from Carson for the September 3 note. Nov. 5 Received payment of principal plus interest from Mulan for the August 7 note. Dec. 1 wrote off the privet account against the Allowance for Doubtful Accounts. Required: 1-a. First, complete the table below to calculate the interest amount at December 31, Year 1. 1-b. Use the calculated value to prepare your journal entries for Year 1 transactions. 1-c. First, complete the table below to calculate the interest amounts 1-d. Use those calculated values to prepare your journal entries for Year 2 transactions 2. If Ohlm pledged its receivables as security for a loan from the bank, where on the financial statements does it disclose this pledge of receivables? Complete this question by entering your answers in the tabs below. Required 1A Required 1B Required 10 Required 1D Required 2 First, complete the table below to calculate the interest amount at December 31, Year 1. Total Through Maturity Interest Recognized n.
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Complete this question by entering your answers in the tabs below. Required 1A Required 1B Required 1C Required 1D Required 2 Use the calculated value to prepare your journal entries for Year 1 transactions. (Do not round inter View transaction list Journal entry worksheet Accepted a $12,000, 60-day, 10% note in granting Danny Todd a time extension on his past-due account receivable. Note: Enter debits before credits. General Journal Debit Credit Date Dec 16 F Record entry Clear entry View general journal
Complete this question by entering your answers in the tabs below. Required 1A Required 1B Required 1C Required 1D Required 2 First, complete the table below to calculate the interest amounts. (Do not round intermediate ci Total Through Maturity Midnight Co. A. Privet Note Mulan Note Midnight Co. Note - March - March 17, August 7, Year Note - May 31, 2, Year 2 Year 2 Year 2 N. Carson Note - September 3, 2017 C Principal Rate (%) Time Total interest < Required 18 Required 10 >
Required 1A Required 1B Required 1C Required 10 Required 2 Use those calculated values to prepare your journal entries for Year 2 transactions. View transaction list Journal entry worksheet 10 Received Todd's payment of principal and interest on the note dated December 16. Note: Enter debits before credits. Date General Journal Feb 14 Debit Credit Record entry Clear entry View general journal
Answers
1a.
Calculate the interest as follows:
Total through maturity Interest recognized December 31 Principal $12,000 $12,000 rate 10% 10% Time 60/360 15/360 Total Interest (Principal * rate * Time) 200 50 _______________________________________________________________________________________________
1b.
Journal Entries for 2016 as follows:
Date Account Titles and Explanations Debit ($) Credit ($) Dec-16 Notes receivable D. Todd 12000 Account receivable D. Todd 12000 Dec-31 Interest receivable 50 Interest revenue 50 _____________________________________________________________________________________________
1c.
Calculate the interest amount as given below:
Midnight Co. Note- March 2, year 2 A. Privet Note - March 17, Year 2 Mulan note - August 7, year 2 Midnight Co. Note - May 31, year 2 N. Carson note - September 3, 2017 Principal $6,900 $2,600 $8,100 $7038 (6900+138) $2,170 Rate 8% 7% 10% 8% 10% Time 90/360 30/360 90/360 46/360 60/360 Total Interest (Principal * rate * Time) 138 15 202.5 72 36 ___________________________________________________________________________________________________
1d.
Journal entries for 2017 as follows:
Feb-14 Cash 12200 Interest revenue 150 Interest receivable 50 Notes receivable - D. Todd 12000 Mar-02 Notes receivable- Midnight Co 6900 Accounts receivable- Midnight Co 6900 Mar-17 Notes receivable - A. Privet 2600 Accounts receivable A. Privet 2600 Apr-16 Accounts receivable A. Privet 2615 Notes receivable- A. Privet 2600 Interest revenue 15 Jun-02 Accounts receivable Midnight Co 7038 Notes receivable Midnight Co 6900 Interest revenue 138 July-17 Cash 7110 Interest revenue 72 Accounts receivable Midnight Co 7038 Aug-07 Notes receivable- Mulan 8100 Accounts receivable- Mulan 8100 Sep-03 Notes receivable- N. Garson 2170 Accounts receivable- N. Garson 2170 Nov-02 Cash 2206 Interest revenue 36 Notes receivable- N. Garson 2170 Nov-05 Cash 8302.5 Interest revenue 202.5 Notes receivable- Multan 8100 Dec-01 Allowance for doubtful accounts 2615 Accounts receivable - A. Privet 2615
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