Question

Q.3 On January 1, 2020, Black Company received a two-month, 9%, $35,000 note from Sami for the settlement of his open account.

The entry by Black Company on January 1, 2020 would include a:

Q.4 Blue Company Made sales of $58,000 on VISA credit cards. The credit card service charge is 2%. The entry to record this transaction by Blue Company will include a credit to Sales Revenue of $58,000 and a debit(s) to

Q.5 Assuming a 360-day year, the interest on a $50,000, 6%, 60-day note receivable is

Q.6 A 60-day note receivable dated July 17 has a maturity date of

Answer 1

Q 3)

Date	Account title and explanation	Debit	Credit
January 1,2020	Notes receivable	$35,000
	Accounts receivable		$35,000
	[To record acceptance of notes]

Q 4) Debit(s) to: Cash $ 56,840 & Card fee expense $1,160

Explanation:

Account title and explanation	Debit	Credit
Cash	$56,840
Card fee expense [$58,000 x 2%]	$1,160
Sales Revenue		$58,000
[To record credit card sales]

Q 5) Interest on notes receivable is $500

Calculations:

Interest = $50,000 x 6% x (60/360)

= $3,000 x (60/360)

=$500

Q 6) Maturity date is September 15

Explanation:

Total days		60
Days in July [31-17]	14
Days in August	31	45
Days in September		15

Thus, September 15 is the maturity date.