On January 1, 2014, Derek Company had Accounts Receivable $139,000, Notes Receivable $30,000, and Allowance for Doubtful Accounts $13,200. The note receivable is from Kaye Noonan Company. It is a 4-month, 12% note dated December 31, 2013. Derek Company prepares financial statements annually. During the year, the following selected transactions occurred.
Jan. 5 Sold $24,000 of merchandise to Zwingle Company, terms n/15.
20 Accepted Zwingle Company’s $24,000, 3-month, 9% note for balance due.
Feb. 18 Sold $8,000 of merchandise to Gerard Company and accepted Gerard’s $8,000, 6-month, 8% note for the amount due.
Apr. 20 Collected Zwingle Company note in full.
30 Received payment in full from Kaye Noonan Company on the amount due.
May 25 Accepted Isabella Inc.’s $4,000, 3-month, 7% note in settlement of a past-due balance on account.
Aug. 18 Received payment in full from Gerard Company on note due.
25 The Isabella Inc.’s note was dishonored. Isabella Inc.’s is not bankrupt; future payment is anticipated.
Sept. 1 Sold $12,000 of merchandise to Fernando Company and accepted a $12,000, 6-month, 10% note for the amount due.