ACC305_Week3_Assignment

ACC305_Week3_Assignment - 600 (to record interest accrued)...

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Week 3 Assignment P7-7 1. Feb. 28, 2006 Note receivable 10,000 Sales revenue 10,000 (to record sale on account) March 31,2006 Note receivable 8,000 Discount ($8,000 x 10%) 800 Sales revenue 7,200 (to record sale on account) April 3, 2006 Accounts receivable 7,000 Sales revenue 7,000 (to record sale on account) April 11, 2006 Cash (98% x $7,000) 6,860 Sales discounts (2% x $7,000) 140 Accounts receivable 7,000 (to record collection of account receivable) April 17, 2006 Sales returns 5,000 Accounts receivable 5,000 Inventory 3,200 Cost of goods sold 3,200
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(to record the return of merchandise) April 30, 2006 Cash (99% x $50,000) 49,500 Loss on sale of receivables (1% x $50,000) 500 Accounts receivable 50,000 (to record sale of receivables) June 30, 2006 Interest receivable 333 Interest revenue ($10,000 x 10% x 4/12) 333 (to record interest accrued) June 30, 2006 Cash (calculation below) 10,266 Loss on sale of note receivable 67 Interest receivable 333 Note receivable 10,000 (to record discount of note receivable) Aug. 31, 2006 No entry required 2. Dec. 31, 2006 Discount 600 Interest revenue ($8,000 x 10% x 9/12)
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Unformatted text preview: 600 (to record interest accrued) Calculation of cash proceeds Face amount of note $10,000 Interest to maturity ($10,000 10% 7/12) 583 Maturity value 10,583 Discount ($10,583 12% 3/12) (317) Cash proceeds $10,266 3. Date Income February 28 $10,000 March 31 7,200 April 3 7,000 April 11 (140) April 17 (5,000) April 17 3,200 April 30 (500) June 30 333 June 30 (67) December 31 600 Total $22,626 P7-10 El Gato Painting Company Bank Reconciliation Balance per bank, December 31 $3,851 Add: Deposits in transit 2,150 Less: Checks outstanding (831) Bank error (1,300) Adjusted bank balance $3,870 Balance per books, December 31 $4,422 Deduct: Error in recording check #411 (90) NSF check (440) Service charges (22) Adjusted book balance $3,870 2. Adjusting entries to correct book balance: Accounts receivable (NSF checks) 440 Advertising expense 90 Miscellaneous expense (bank service charges) 22 Cash 552...
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This note was uploaded on 08/14/2011 for the course ACC 305 taught by Professor B.forde during the Spring '11 term at Ashford University.

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ACC305_Week3_Assignment - 600 (to record interest accrued)...

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