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Accounting for Notes Receivable

Yarnell Electronics sells computer systems to small businesses. Yarnell engaged in the following activities involving notes receivable:

On September $1,$ Yarnell sold a $$5,000$ system to Ross Company. Ross gave Yarnell a $6-$month, $11\%$ note as payment.

On December $1,$ Yarnell sold an $$8,100$ system to Searfoss Inc. Searfoss gave a $9-$month, $10\%$ note as payment.

On March $1,$ On March $1,$ Ross paid the amount due on its note.

On September $1,$ Searfoss paid the amount due on its note.

Required:

Question Content Area

Prepare the necessary journal and adjusting entries for Yarnell Electronics to record these transactions. If an amount box does not require an entry, leave it blank. If required, round your answers to two decimal places.

Note from Ross Company:

Sept. $1$

Notes Receivable

$5,000$

Sales Revenue

$5,000$

$($Record sale$)$

Dec. $31$

Interest Receivable

Interest Income

$($Record accrued interest income$)$

Mar. $1$

Cash

Notes Receivable

$5,000$

Interest Receivable

Interest Income

$($Record collection of note receivable$)$

Question Content Area

Note from Searfoss Inc.:

If an amount box does not require an entry, leave it blank. If required, round your answers to two decimal places.

Dec. $1$

Notes Receivable

Sales Revenue

$($Record sale$)$

Dec. $31$

Interest Receivable

Interest Income

$($Record accrued interest income$)$

Sept. $1$

Cash

Notes Receivable

Interest Receivable

Interest Income

$($Record collection of note$)$

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