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17 June, 01:33

Vanderbilt Corporation, which utilizes a calendar year as its fiscal year, is the payee on a $12,000, 7%, 8-month note receivable from Stanford Company on October 1st, 2016. Journalize the entry to record the receipt of payment in full on June 1, 2017.

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  1. 17 June, 02:03
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    Given:

    Payee: Vanderbilt Corporation

    Notes Receivable from Stanford Company

    $12,000, 7%, 8-month

    Debit Credit

    October 1, 2016

    Notes Receivable 12,000

    Cash 12,000

    *to record notes receivable from Stanford Company

    December 31, 2016

    Interest Receivable 560

    Interest Income 560

    12,000 * 7% * 8/12 = 560

    *to recognize interest earned but not yet received

    June 1, 2017

    Cash 12,560

    Notes Receivable 12,000

    Interest Receivable 560

    *to recognize full payment on note.
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