accounting homework unit 7

E6-2

Determine due date and interest on notes

Obj|1

✓ Feb. 20, $450

Determine the due date and the amount of interest due at maturity on the following notes:

	Date of Note	Face Amount	Interest Rate Term Of Note	Term of Note
a.	January 6	$40,000	9% 45 Days	45 days
b.	March 23	9,000	10 60 Days	60 days
c.	May 30	12,000	12 90 Days	90 days
d.	August 30	18,000	10 120 Days	120 days
e.	October 1	10,500	8 60 Days	60 days

E6-7

Estimating doubtful accounts

Obj|4

Newbury Bikes Co. is a wholesaler of motorcycle supplies. An aging of the company's accounts receivable on December 31, 2012, and a historical analysis of the percentage of uncollectible accounts in each age category are as follows:

Age interval Balance Percent Uncollectible

Not Past Due $677,000 ½%

1-30 Days Past Due $158,000 2%

31-60 Days Past Due $54,000 5%

61-90 Days Past Due $20,500 15%

91-180 Days Past Due $15,000 40%

Over 180 Days Past Due $10,500 75%

$925,000

   Estimate what the balance of the allowance for doubtful accounts should be as of December 31, 2012.

E6-18

Lower-of-cost-or-market inventory

Obj|8

✓ LCM: $22,780

On the basis of the following data, determine the value of the inventory at the lower of cost or market. Assemble the data in the form illustrated in  Exhibit 9 .

Commodity	Inventory Quantity	Unit Cost Price Unit Market Price	Unit Market Price
Buffal	35	$115 $120	$120
Dakota	67	90 75	75
Frontier	8	300 280	280
Midwest	83	40 30	30
Rainbow	100	90 94	94