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On August 2, Jun Co. receives a $6,000, 90-day, 12% note from customer Ryan Albany as payment on his $6,000 account receivable. Prepare Jun’s journal entry assuming the note is honored by the customer on October 31 of that same year. (Use 360 days a year.)

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saqib097

Answer:

The journal entry for the following economic activity is given below.

Explanation:

Interest revenue = 6000*12% * 91/360 = 182

Date                     Account Title                                           Dr             Cr

Oct 31                    Cash                                                      6,180

                                  Notes receivable                                             6,000

                                  Interest revenue                                                180

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The journal entry assuming the note is honored by the customer on October 31 of that same year is: Debit Cash  $6,180; Credit interest revenue $180; Credit Notes receivable R-Albany.

Journal entry                          

August 2

Debit Note payable-R- Albany $6,000

Credit Account receivable- R-Albany $6,000

Oct 31                  

Debit Cash        $6,180

($6,000+$180)                                        

Credit  Interest revenue    $180

(6000×12% × 90/360)

Credit Notes receivable R-Albany $6,000              

Inconclusion the journal entry assuming the note is honored by the customer on October 31 of that same year is: Debit Cash  $6,180; Credit interest revenue $180; Credit Notes receivable R-Albany.    

Learn more about journal entry here:https://brainly.com/question/14279491              

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