Question - Kolton Company closes its books on its July 31 year-end. The company does not make entries to accrue for interest except at its year-end. On June 30, the Notes Receivable account balance is $23,800. Notes Receivable includes the following.
|
Date
|
Maker
|
Face Value
|
Term
|
Maturity Date
|
Interest Rate
|
|
April 21
|
Booth Inc.
|
$6,000
|
90 days
|
July 20
|
8%
|
|
May 25
|
Manning Co.
|
7,800
|
60 days
|
July 24
|
10%
|
|
June 30
|
ANF Corp.
|
10,000
|
6 months
|
December 31
|
6%
|
During July, the following transactions were completed.
July 5 Made sales of $4,500 on Kolton credit cards.
14 Made sales of $600 on Visa credit cards. The credit card service charge is 3%.
20 Received payment in full from Booth Inc. on the amount due.
24 Received payment in full from Manning Co. on the amount due.
Journalize the July transactions and the July 31 adjusting entry for accrued interest receivable. (Interest is computed using 360 days; omit cost of goods sold entries.)