Richter Company, Which Has a December 31 Year End, and Uses

question 57

Essay

Richter Company, which has a December 31 year end, and uses a periodic inventory system, completed the following transactions during 2018 and 2019:
2018
Oct. 14 Sold merchandise to Bruce Company, receiving a 60-day, 9% note for $4,000.
Nov. 16 Sold merchandise to Marine Company receiving a 72-day, 8% note for $6,500.
Dec. 13 Received amount due from Bruce Company.
Dec. 31 Accrued interest on the Marine Company note.
2019
Jan. 27 Collected in full from Marine Company.
Prepare the necessary journal entries to record the above transactions.

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Definitions:

Federal Income Tax

A tax levied by the United States federal government on the annual earnings of individuals, corporations, trusts, and other legal entities.

Trade Fixtures

Articles of personal property that have been annexed to real property leased by a tenant during the term of the lease and that are necessary to the carrying on of a trade.

Substantial Damage

Significant physical harm or damage to a property or structure, often affecting its value, usability, or function.

Lease Term

The duration for which a lease agreement is valid, typically specifying start and end dates.