The following selected transactions for notes receivable are for Marx Limited May 1 Received a six-month, 5%, $15,120 note on account from Blackstone Limited Interest is due at maturity Accrued interest on the Blackstone note on this date, which is Marx's year end. June 30 July 1 Aug 1 Lent $13,200 cash to an employee, Noreen Wong, issuing a three-month, 7% note. Interest is due at the beginning of each month, starting Augus Received the interest due from Ms. Wong Sept. 1 Received the interest due from Ms. Wong Oct. 1 Received payment in full for the employee note from Ms. Wong. Nov 1 Wrote off the Blackstone note because Blackstone defaulted. Future payment is not expected

The following selected transactions for notes receivable are for Marx Limited May 1 Received a six-month, 5%, $15,120 note on account from Blackstone Limited Interest is due at maturity Accrued interest on the Blackstone note on this date, which is Marx's year end. June 30 July 1 Aug 1 Lent $13,200 cash to an employee, Noreen Wong, issuing a three-month, 7% note. Interest is due at the beginning of each month, starting Augus Received the interest due from Ms. Wong Sept. 1 Received the interest due from Ms. Wong Oct. 1 Received payment in full for the employee note from Ms. Wong. Nov 1 Wrote off the Blackstone note because Blackstone defaulted. Future payment is not expected

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter9: Accounting For Receivables

Section: Chapter Questions

Problem 22MC: A company collects an honored note with a maturity date of 24 months from establishment, a 10%...

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On June 1, Phillips Corporation sold, with recourse, a note receivable from a customer to a bank. The note has a face value of 15,000 and a maturity value (principal plus interest) of 15,400. The discount is calculated to be 385, and the accrued interest income is 100. The recourse liability is estimated to be 1,000. Prepare the journal entry of Phillips to record the sale of the note receivable.
On December 1 of the current year, Jordan Inc. assigns 125,000 of its accounts receivable to McLaughlin Company for cash. McLaughlin Company charges a 750 service fee, advances 85% of Jordans accounts receivable, and charges an annual interest rate of 9% on any outstanding loan balance. Prepare the related journal entries for Jordan.
A company collects an honored note with a maturity date of 24 months from establishment, a 10% interest rate, and an initial loan amount of $30,000. Which accounts are used to record collection of the honored note at maturity date? A. Interest Revenue, Interest Expense, Cash B. Interest Receivable, Cash, Notes Receivable C. Interest Revenue, Interest Receivable, Cash, Notes Receivable D. Notes Receivable, Interest Revenue, Cash, Interest Expense
On December 1 of the current year, Jordan Inc. assigns 125,000 of its accounts receivable to McLaughlin Company for cash. McLaughlin Company charges a 750 service fee, advances 85% of Jordans accounts receivable, and charges an annual interest rate of 9% on any outstanding loan balance. Prepare the related journal entries for Jordan. Refer to RE6-10. On December 31, Jordan Inc. received 50,000 on assigned accounts. Prepare Jordans journal entries to record the cash receipt and the payment to McLaughlin.
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A customer was unable to pay the accounts receivable on time in the amount of $34,000. The customer was able to negotiate with the company and transferred the accounts receivable into a note that includes interest, along with an up-front cash payment of $6,000. The note maturity date is 24 months with a 15% annual interest rate. What is the entry to recognize this transfer?
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