rief Exercise 154
Kohl Company lent $53,200 to Hemingway, Inc, accepting Hemingway’s 2-year, $65,312, zero-interest-bearing note. The implied interest rate is 10.8%. Prepare Kohl’s journal entries for the initial transaction, recognition of interest each year, and the collection of $65,312 at maturity. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)
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Exercise 159
A trial balance before adjustment included the following:
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| Accounts receivable | $156,000 | |||
| Allowance for doubtful accounts | 1,160 | |||
| Sales | $444,000 | |||
| Sales returns and allowances | 8,200 |
Give journal entries assuming that the estimate of uncollectibles is determined by taking
(1) 6% of gross accounts receivable (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)
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(2) 2% of net sales. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)
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| Click if you would like to Show Work for this question: |
Brief Exercise 6-14
Amy Monroe wants to create a fund today that will enable her to withdraw $31,620 per year for 7 years, with the first withdrawal to take place 5 years from today. (Use the tables below.)
If the fund earns 8% interest, how much must Amy invest today? (Round factor values to 5 decimal places, e.g. 1.25124 and final answers to 0 decimal places, e.g. 458,581.)
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