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.

Question

Zoe Bowen

Mathematics

3 February, 06:30

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.

+3

Answers (1)

Know the Answer?

Lillian Baird · Answer 1

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.