On January 1, 2014, Morfitt Company had Accounts Receivable $98,000 and Allowance for Doubtful Accounts $8,100. Morfitt Company prepares financial statements annually. During the year, the following selected transactions occurred.
Sold $10,800 of merchandise to Motte Company, terms n/30.
Accepted a $10,800, 4-month, 9% promissory note from Motte Company for the balance due.
Sold $13,500 of merchandise to Gitchel Company and accepted Gitchel”s $13,500, 2-month, 8% note for the balance due.
Sold $9,000 of merchandise to Benedict Co., terms n/10.
Accepted a $9,000, 3-month, 8% note from Benedict Co. for the balance due.
Collected Gitchel Company note in full.
Collected Motte Company note in full.
Benedict Co. dishonors its note of April 5. It is expected that Benedict will eventually pay the amount owed.
Sold $12,000 of merchandise to Kriley Co. and accepted Kriley”s $12,000, 3-month, 12% note for the amount due.
Kriley Co.”s note was dishonored. Kriley Co. is bankrupt, and there is no hope of future settlement.
Journalize the transactions.
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