Prepare journal entries for year 1 transactions

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Reference no: EM133609088

Year 1

December 16 Accepted a(n) $10,100, 60-day, 7% note in granting Danny Todd a time extension on his past-due account receivable.
December 31 Made an adjusting entry to record the accrued interest on the Todd note.

Year 2

February 14 Received Todd's payment of principal and interest on the note dated December 16.
March 2 Accepted a(n) $6,800, 7%, 90-day note in granting a time extension on the past-due account receivable from Midnight Company.
March 17 Accepted a $3,300, 30-day, 7% note in granting Ava Privet a time extension on her past-due account receivable.
April 16 Privet dishonored her note.
May 31 Midnight Company dishonored its note.
August 7 Accepted a(n) $8,900, 90-day, 11% note in granting a time extension on the past-due account receivable of Mulan Company.
September 3 Accepted a $2,630, 60-day, 11% note in granting Noah Carson a time extension on his past-due account receivable.
November 2 Received payment of principal plus interest from Carson for the September 3 note.
November 5 Received payment of principal plus interest from Mulan for the August 7 note.
December 1 Wrote off the Privet account against the Allowance for Doubtful Accounts.

Required:

1-a. First, complete the table below to calculate the interest amount at December 31, Year 1.

1-b. Use the calculated value to prepare journal entries for Year 1 transactions.

1-c. First, complete the table below to calculate the interest amounts.

1-d. Use those calculated values to prepare journal entries for Year 2 transactions.

2. If Ohlm pledged its receivables as security for a loan from the bank, where on the financial statements does it disclose this pledge of receivables?

Reference no: EM133609088

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