Question

Samberg Inc. had the following transactions.

Oct. 1 – Sold $14,500 of merchandise on account, 1/10, n/30 to McCormick Industries.

Nov. 1 – Received a $14,500, 90-day, 10% note from McCormick Industries to settle its $14,500 unpaid balance.

Dec. 31 – Accrued interest on the note. (Round your answer to the nearest whole dollar amount.)

Jan. 31 – Received the interest on the note’s maturity date.

Jan. 31 – Received the principal on the note’s maturity date. (Round your answer to the nearest whole dollar amount.)

Required:

Prepare the required journal entries.

Answer 1

Date	Account title	Debit	credit
Oct 1	Accounts receivable	14500
	sales revenue		14500
Nov 1	Note receivable	14500
	Accounts receivable		14500
Dec 31	Interest receivable	242
	Interest revenue		242
	[Being interest accrued for 60 days [2Nov -31dec ] 14500*.10*60/360]
30Jan	cash	363
	Interest receivable		242
	Interest revenue [14500*.10*30/360]		121
30 Jan	cash	14500
	Note receivable		14500