Questions -
Q1. On March 1, 2013 Tom's textile accepted a $840,000, 4% promissory notes receivable due on October 1, 2013. On August 31, 2013 Tom's textiles discounted the note with the Central Bank. Central bank's discount rate of 9%. Assume that all conditions necessary to treat the transfer as a sale are met. Record journal entries for all dates of transaction?
Q2. On July 1, 2016, Happy tubs sold a hot tub to Monica, receiving a twelve-month, non-interest-bearing note of $9,600 in exchange for a hot tub normally sells for $8,000. Please prepare all journal entries for years 2016 and 2017.
Q3. On October 1, 2014, Harvey's wholesale sold $350,000 receivables to Northeast Trust with recourse. Northeast trust charges a 3% fee upfront for receivables factored with recourse. Harvey's Receives 70% of the factored receivables on October 1, 2014 and will receive the balance on collection. Harvey's estimates a fair value of the recourse obligation to be $6,500. On March 31, 2015 Northeast Trust pays $90,000 as final settlement of all collections. Record all necessary journal entries for all dates of the transaction in the books of Harvey's.