On August 2, Jun Co. receives a $7,000, 90-day, 11.5% note from customer Ryan Albany as payment on his $7,000 account. Prepare J

Question

3 years ago

15

On August 2, Jun Co. receives a $7,000, 90-day, 11.5% note from customer Ryan Albany as payment on his $7,000 account. Prepare J

un's journal entry assuming the note is honored by the customer on October 31 of that same year. (Round your answers to nearest whole dollar value. Use 360 days a year.)

Business

1 answer:

Likurg_2 [28] · Answer 1 · 2022-09-11T11:59:42+03:00

Answer:

Oct 31

Dr Cash $7,201

Cr Notes receivable—R. Albany $7,000

Cr Interest revenue $201

Explanation:

Preparation of Jun's journal entry assuming the note is honored by the customer on October 31, of that same year

Oct 31

Dr Cash $7,201

($7,000+$201)

Cr Notes receivable—R. Albany $7,000

Cr Interest revenue $201

(11.5%*7,000*90/360)