The June 30, 2006 balance sheet of the Upham Company included the following information:*The company is contingently liable for discounted notes receivable of $38,000. During the company’s fiscal year ending June 30, 2007 the following transactions occurred:1. Sales on credit $874,6002. Collections of accounts receivable 841,0003. Accounts receivable written off as uncollectible 13,8004. Notes receivable collected 29,0005. Customer notes received in payment of accounts receivable 72,0006. Notes receivable discounted that were paid at maturity 36,0007. Notes receivable discounted that were defaulted, including interest of $20 and a $5 fee. This amount is expected to be collected during the 2008 fiscal year 2,0258. Proceeds from customer notes discounted with recourse (face value $45,000, accrued interest revenue $200) 45,075 9. Collections on accounts previously written off 50010. Sales returns and allowances (on credit sales) 2,00011. Bad debts were estimated to be 1.5% of credit salesRequired1. Prepare journal entries necessary for Upham to record the preceding transactions.2. Prepare an analysis and schedule that shows the amounts of the accounts receivable, allowance for doubtful accounts, notes receivable, and notes receivable dishonored accounts that will be disclosed on Upham’s June 30, 2007 balancesheet.
The June 30 2006 balance sheet of the Upham Company