Journal Entries for Accounts and Notes ReceivableLancaster, Inc., began business on January 1. Certain transactions for the year follow:Jun.8Received a $18,000, 60 day, eight percent note on account from R. Elliot.Aug.7Received payment from R. Elliot on her note (principal plus interest).Sep.1Received a $21,000, 120 day, nine percent note from B. Shore Company on account.Dec.16Received a $17,000, 45 day, ten percent note from C. Judd on account.Dec.30B. Shore Company failed to pay its note.Dec.31Wrote off B. Shore's account as uncollectible. Lancaster, Inc., uses the allowance method of providing for credit losses.Dec.31Recorded expected credit losses for the year by an adjusting entry. Accounts written off during this first year have created a debit balance in the Allowance for Doubtful Accounts of $25,600. An analysis of aged receivables indicates that the desired balance of the allowance account should be $22,500.Dec.31Made the appropriate adjusting entries for interest.RequiredRecord the foregoing transactions and adjustments in general journal form. (Use 360 days for all interest calculations. Round all Interest Income calculations to the nearest dollar.)

General journal: This is a journal used to record infrequent transactions like adjusting entries,…

Answered: Journal Entries for Accounts and Notes…

Century 21 Accounting General Journal

11th Edition

ISBN:9781337680059

Author:Gilbertson

Publisher:Gilbertson

Chapter21: Accounting For Accruals, Deferrals, And Reversing Entries

Section21.1: Accruals

Problem 1WT

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Journal Entries for Accounts and Notes Receivable
Lancaster, Inc., began business on January 1. Certain transactions for the year follow:

Jun.8	Received a $18,000, 60 day, eight percent note on account from R. Elliot.
Aug.7	Received payment from R. Elliot on her note (principal plus interest).
Sep.1	Received a $21,000, 120 day, nine percent note from B. Shore Company on account.
Dec.16	Received a $17,000, 45 day, ten percent note from C. Judd on account.
Dec.30	B. Shore Company failed to pay its note.
Dec.31	Wrote off B. Shore's account as uncollectible. Lancaster, Inc., uses the allowance method
	of providing for credit losses.
Dec.31	Recorded expected credit losses for the year by an adjusting entry. Accounts written off
	during this first year have created a debit balance in the Allowance for Doubtful Accounts of
	$25,600. An analysis of aged receivables indicates that the desired balance of the
	allowance account should be $22,500.
Dec.31	Made the appropriate adjusting entries for interest.

Required
Record the foregoing transactions and adjustments in general journal form. (Use 360 days for all interest calculations. Round all Interest Income calculations to the nearest dollar.)

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