179.Jordan Co. uses the allowance method of accounting for uncollectible accounts. Jordan Co. accepted a $5,000, 12%, 90-day note dated May 16, from Beckam Co. in exchange for its past-due account receivable. Make the necessary general journal entries for Jordan Co. on May 16 and the August 14 maturity date, assuming that the:
a. Note is held until maturity and collected in full at that time.
b. Note is dishonored; the amount of the note and its interest are written off as uncollectible.
180.Prepare general journal entries for the following transactions for the current year:
Apr. 25Sold $4,500 of merchandise to Dunn Corp., receiving a 10%, 60-day. $4,500 note receivable.
June 24The note of Dunn Corp., received on April 25 was dishonored.
181.The following data are taken from the comparative balance sheets of Grayling Company. Compute and interpret its accounts receivable turnover for Year 2. Competitors average a turnover of 7.5. How is the company doing in relation to its competitors?
Year 2Year 1
Accounts receivable, net180,230220,450
Net sales1,500,7501,495,600
182.On July 31, Orwell Co. has $448,800 of accounts receivable.
Required:
1. Prepare journal entries to record the following selected August transactions. The company uses the perpetual inventory system.
2. Also prepare any footnotes to the August 31 financial statements that result from these transactions.
3. Calculate the balance in the Accounts Receivable account as of August 10.
Aug. 3Sold $250,000 of merchandise (that cost $122,000) to customers on credit.
Aug. 5Sold $300,000 of accounts receivable to Cash Solutions. Cash Solutions charges a 7% factoring fee.
Aug. 8Received $165,200 from customers in payment on their accounts.
Aug. 9Borrowed $50,000 cash from State Bank, pledging $65,000 of accounts receivable as security for the loan. The note is a 90-day, 9% note.