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Chapter 2
Accounting for Receivables
AP-17A (
7
)
Lakisha Ogata operates a proprietorship selling machinery. Because of the high value of
the machinery sold, Lakisha often requires customers to sign a note. Lakisha originally sold
a Gadget machine to Neil Marcin for $10,000 on November 14, 2016. The sale was initially
recorded as an account receivable, but now Lakisha decides to ask Neil to sign a note. On
December 1, 2016, Neil signs a one-year note to be paid on maturity, plus 5% interest.
Lakisha’s company has a year-end of April 30. Prepare the journal entries to reflect the
transactions related to the receivable and note.
Date
Account Title and Explanation
Debit
Credit
