Question

The interest accrued on $6,600 at 8% for 30 days is: (Use 360 days a year.)

A. $44

B. $264

C. $264

D. $ 62

E. $ 53

A company receives a 5%, 90-day note for $3,600. The total interest due on the maturity date is: (Use 360 days a year.)

A. $90.00.

B. $180.00.

C. $45.00.

D.$105.00.

E. $60.00

On July 9, Mifflin Company receives a $9,300, 120-day, 12% note from customer Payton Summers as payment on account. What entry should be made on July 9 to record receipt of the note?

A. Debit Notes Receivable $9,300; credit Sales $9,300.

B. Debit Accounts Receivable $9,300; credit Sales $9,300.

C. Debit Notes Receivable $9,672; credit Sales $9,672.

D. Debit Notes Receivable $9,300; credit Accounts Receivable $9,300.

E. Debit Notes Receivable $9,669; credit Interest Revenue $369; credit Accounts Receivable $9,300.

Brinker accepts all major bank credit cards, including First Savings Bank's, which assesses a 2.5% charge on sales for using its card. On May 26, Brinker had $6,400 in First Savings Bank Card credit sales. What entry should Brinker make on May 26 to record the deposit?

A. Debit Cash $6,240; debit Credit Card Expense $160; credit Sales $6,400.

B. Debit Accounts Receivable $6,400; credit Sales $6,400.

C. Debit Cash $6,560; credit Credit Card Expense $160; credit Sales $6,400.

D. Debit Accounts Receivable $6,240; debit Credit Card Expense $160; credit Sales $6,400.

E. Debit Cash $6,400; credit Sales $6,400.

On February 1, a customer's account balance of $2,600 was deemed to be uncollectible. What entry should be recorded on February 1 to record the write-off assuming the company uses the allowance method?

A. Debit Allowance for Doubtful Accounts $2,600; credit Bad Debts Expense $2,600.

B. Debit Accounts Receivable $2,600; credit Allowance for Doubtful Accounts $2,600.

C. Debit Allowance for Doubtful Accounts $2,600; credit Accounts Receivable $2,600.

D. Debit Bad Debts Expense $2,600; credit Accounts Receivable $2,600.

E. Debit Bad Debts Expense $2,600; credit Allowance for Doubtful Accounts $2,600.

Answer 1

1) Interest accured = 6600*8%*30/360 = $44

So answer is a) $44

2) Total interest due on maturity date = 3600*5%*90/360 = 45

So answer is c) $45.00

3) Journal entry :

Date	account and explanation	debit	credit
july 9	Notes receivable	9300
	Account receivable		9300

So answer is d) Debit Notes Receivable $9,300; credit Accounts Receivable $9,300.

4) Journal entry :

Date	account and explanation	debit	credit
	Cash (6400*97.5%)	6240
	Credit card expense	160
	Sales revenue		6400

So answer is a) Debit Cash $6,240; debit Credit Card Expense $160; credit Sales $6,400.

5) Journal entry :

Date	account and explanation	debit	credit
Feb 1	Allowance for doubtful accounts	2600
	Account receivable		2600

So answer is c) Debit Allowance for Doubtful Accounts $2,600; credit Accounts Receivable $2,600.