Question

Exercise 9-11

Record the following transactions for Redeker Co. in the general journal. (Record journal entries in the order presented in the problem. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

2017
May	1		Received a $24,000, 12 months, 10% note in exchange for Mark Chamber’s outstanding accounts receivable.
Dec.	31		Accrued interest on the Chamber note.
Dec.	31		Closed the interest revenue account.
2018
May	1		Received principal plus interest on the Chamber note. (No interest has been accrued in 2018.)

Answer 1

Solution:
Date	General Journal	Debit	Credit
2017
May   1	Notes Receivable	24,000
	Accounts Receivable		24,000
Dec    31	Interest Receivable	1,600
	Interest Revenue		1,600
Notes:	Interest Revenue = $24,000 x 10% x 8/12 = 1,600
Dec    31	Interest Revenue	1,600
	Income Summary		1,600
2017
May   1	Cash	26,400
	Notes Receivable		24,000
	Interest Receivable		1,600
	Interest Revenue		800
Notes:	Interest Revenue = 24,000 x 10% x 4/12 =   800
Please feel free to ask if anything about above solution in comment section of the question.