Marty Co. closes its books monthly. On June 30, selected ledger account balances are:
Notes Receivable........ $57,000
Interest Receivable..... 420
Notes Receivable include the following.
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During July, the following transactions were completed.
July 5 Made sales of $7,200 on Marty Co. credit cards.
14 Made sales of $1,000 on Visa credit cards.The credit card service charge is 3%.
14 Added $510 to Marty Co. credit card customer balances for finance charges on unpaid balances.
15 Received payment in full from Rice Inc. on the amount due.
25 Received notice that the Smelter Co. note has been dishonored. (Assume that Smelter Co. is expected to pay in the future.)
Instructions
(a) Journalize the July transactions and the July 31 adjusting entry for accrued interest receivable. (Interest is computed using 360 days.)
(b) Enter the balances at July 1 in the receivable accounts. Post the entries to all of the receivable accounts.
(c) Show the balance sheet presentation of the receivable accounts at July31.