Question

Garden Works Co. had a number of transactions involving receivables during the year 2017. Each of...

Garden Works Co. had a number of transactions involving receivables during the year 2017. Each of them follows.

Required

Prepare journal entries to record these independent transactions on the books of Garden Works Co. The Company's year-end is December 31.

a. On November 15, 2017, Garden Works Co. agreed to accept $500 in cash and a $2,000,90 day, 8% note from Agro Company to settle its $2,500 past-due account. Determine the maturity date and record the entry on November 15, on December 31, and on the date of maturity

b. Garden Works Co. held a $1,800, 6% 45 day note of Altamira Industries. At Maturity, December 15, Altamira dishonoured the note.

Record the dishonouring of the Note Receivable.

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Note: Interest has been rounded off to nearest dollar amount

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