Solution-Interest is computed using a 360 day year

Interest is computed using a 360 day year

Reference no: EM131144323

Mendosa Company closes its books monthly. On September 30, selected ledger account balances are:

Notes Receivable....... $33,000
Interest Receivable....... 170
Notes Receivable include the following.

Interest is computed using a 360-day year. During October, the following transactions were completed.

Oct. 7 Made sales of $6,900 on Mendosa credit cards.
12 Made sales of $900 on MasterCard credit cards. The credit card service charge is 3%.
15 Added $460 to Mendosa customer balance for finance charges on unpaid balances.
15 Received payment in full from Chang Inc. on the amount due.
24 Received notice that the Hughey note has been dishonored. (Assume that Hughey is expected to pay in the future.)

Instructions

(a) Journalize the October transactions and the October 31 adjusting entry for accrued interest receivable.

(b) Enter the balances at October 1 in the receivable accounts. Post the entries to all of the receivable accounts.

Reference no: EM131144323

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Interest is computed using a 360 day year

Reference no: EM131144323

Reference no: EM131144323

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