Question

Journalize the following transactions of Trapper Jon’s Productions. Assume 360 days in a year.

June 23. Received a $48,000, 90-day, 8% note dated June 23 from Radon Express Co. on account.
Sept. 21. The note is dishonored by Radon Express Co.
Oct. 21. Received the amount due on the dishonored note plus interest for 30 days at 10% on the total amount charged to Radon Express Co. on September 21.

Answer 1

Step-by-step explanation:

To record note received

On June 23. Debit Credit

Notes Receivable $48,000

Accounts receivable for Radon ExpressCo $48,000

interest revenue = $48,000 x 8%x 90/360

To record dishonored note

On September 21st Debit Credit

Accounts receivable for Radon Co $48,960

Notes Receivable $48,000

Interest Revenue $960

Interest Revenue $48,960 x 10%x 30/360 = $408

Journal to record Cash Received

October 21 Debit Credit

Cash $49,368

Accounts Receivable for Radon Express Co $48,960

Interest $408