Seerden Servicing monitors its accounts receivable

carefully A review determined #4428

Seerden Servicing monitors its accounts receivable carefully. A review determined that a
customer, John Daley, was unable to pay his $130,000 past-due account. Seerden accepted a
90-day promissory note dated April 15, 2014, bearing interest of 5% in exchange for Daley's
account. Another customer, ABC Drilling, signed a 4.75%, six-month note dated May 1 in place
of its $50,000 past-due accounts receivable. On May 31, Seerden's year-end, accrued interest
was recorded on the notes receivable. John Daley honoured his note on the maturity date. ABC
Drilling dishonoured its note on the maturity date. On November 15, Seerden Servicing wrote off
ABC Drilling's account as it was determined to be uncollectible.RequiredPrepare Seerden
Servicing's entries for each of the following dates (round calculations to the nearest whole
cent):a. April 15, 2014b. May 1, 2014c. May 31, 2014d. Maturity date of John Daley's notee.
Maturity date of ABC Drilling's notef. November 15, 2014Analysis Component:Assuming a
$4,000 debit balance in the Allowance for Doubtful Accounts on November 14, 2014, calculate
the balance after posting the entry in (f) above. Comment on the adequacy of the Allowance for
Doubtful Accounts.View Solution:
Seerden Servicing monitors its accounts receivable carefully A review determined

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