Weldon Corporation's fiscal year ends December 31. The following is a list of transactions involving receivables that occurred during 2011:Mar. 17 Accounts receivable of $1,700 were written off as uncollectible. The company uses the allowance method.
30 Loaned an officer of the company $20,000 and received a note requiring principal and interest at 7% to be paid on March 30, 2012.
May 30 Discounted the $20,000 note at a local bank. The bank's discount rate is 8%. The note was discounted without recourse and the sale criteria are met.
June 30 Sold merchandise to the Blankenship Company for $12,000. Terms of the sale are 2/10, n/30. Weldon uses the gross method to account for cash discounts.
July 8 The Blankenship Company paid its account in full.
Aug. 31 Sold stock in a nonpublic company with a book value of $5,000 and accepted a $6,000 non-interest-bearing note with a discount rate of 8%. The $6,000 payment is due on February 28, 2012. The stock has no ready market value.
Dec. 31 Bad debt expense is estimated to be 2% of credit sales for the year. Credit sales for 2011 were $700,000.
Required:
1. Prepare journal entries for each of the above transactions (round all calculations to the nearest dollar).
2. Prepare any additional year-end adjusting entries indicated.