Question

Question 5–Bad Debts (11 marks total) Edmond Company had the following transactions during 2017 and 2018 2017 Jun 1 Received a $7,500, 1-year, 4%, note from Sue Forest as full payment on her account. (1 mark) Nov 1 old merchandise on account to Reeves, Inc. for $16,000, terms 2/10, n/30 (2 marks) Nov 5 Reeves, Inc. returned merchandise worth $4,000. (2 marks) Nov 9 Received payment from Reeves, Inc. less the applicable discount. (2 marks) Dec 31 Accrued interest on Forest’s note. (2 marks) 2018 Jun 1 Sue Forest honoured her promissory note by sending the face amount plus interest. No interest has been accrued in 2018. (2 marks) Required: Prepare journal entries to record the transactions described