Question

Miles Company had the following select receivable transactions.

2019

11/1 Loaned $24,000 cash to N. Jones on a 12-month, 8% note.

12/1 Made Miles Company credit card sales totaling $10,500. (There were no balances prior to December 1.)

12/15 Made Visa credit card sales totaling $14,800 (service charge fee 2%).

12/30 Collected $4,400 on Miles Company credit card sales.

12/31 Added finance charges of 1% to Miles Company credit card balance.

12/31 Accrued interest on N. Jones note.

2020

11/1 Received principal plus interest on N. Jones note. Instructions

Prepare journal entries to record the transactions above assuming Miles Company prepares adjusting entries once a year on December 31.

Answer 1

Date	Accounts	Debit	Credit
11//2019	Notes receivable	24000
	cash		24000
12/1/2019	Accounts receivable	10500
	sales revenue		10500
12/15/2019	Cash	14504
	Service charge fee (14800*2%)	296
	Sales revenue		14800
12/30/2019	Cash	4400
	Accounts receivable		4400
12/31/2019	Accounts receivable (10500-4400)*1%	61
	Interest revenue		61
12/31/2019	Interest receivable (24000*8%*2/12)	320
	Interest revenue		320
11/1/2020	Cash	25920
	Interest receivable (24000*8%*10/12)		1600
	Notes receivable		24000
	Interest receivable (24000*8%*2/12)		320