Speedway Corporation adjusts its books monthly. On September 30, 2021, notes receivable include the following: Issue Date Mar. 31, 2021 May 31, 2021 Aug. 31, 2021 Sept. 30, 2021 Oct. 1 31 31 31 Maker 31 RES Inc. Ihara Ltd. Dragon Limited MGH Corp. Principal $19,800 16,600 4,900 21,300 Interest 6% 4% 7% 5% Interest is due at maturity for the RES and Dragon notes. Interest is due on the first day of the month for the Ihara and MGH notes. At September 30, the balance in the Allowance for Doubtful Notes account is nil. In October, the following selected transactions were completed. Term 7 months 18 months 2 months 16 months Received the interest due from Ihara. Received notice that Dragon was unable to pay its note as scheduled. It expects to be able to pay in the future. The RES note matured and was received in full. Accrued interest on the Ihara and MGH notes. Analyzed the remaining notes for collectibility. Estimated that $16,600 of notes may not be collectible in the future because of significant labour issues currently being experienced by Ihara.

Speedway Corporation adjusts its books monthly. On September 30, 2021, notes receivable include the following: Issue Date Mar. 31, 2021 May 31, 2021 Aug. 31, 2021 Sept. 30, 2021 Oct. 1 31 31 31 Maker 31 RES Inc. Ihara Ltd. Dragon Limited MGH Corp. Principal $19,800 16,600 4,900 21,300 Interest 6% 4% 7% 5% Interest is due at maturity for the RES and Dragon notes. Interest is due on the first day of the month for the Ihara and MGH notes. At September 30, the balance in the Allowance for Doubtful Notes account is nil. In October, the following selected transactions were completed. Term 7 months 18 months 2 months 16 months Received the interest due from Ihara. Received notice that Dragon was unable to pay its note as scheduled. It expects to be able to pay in the future. The RES note matured and was received in full. Accrued interest on the Ihara and MGH notes. Analyzed the remaining notes for collectibility. Estimated that $16,600 of notes may not be collectible in the future because of significant labour issues currently being experienced by Ihara.

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter9: Long-term Liabilities

Section: Chapter Questions

Problem 94PSB

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