the amount of interest that jasper will collect on the loan is: $12,200
journal entry :
cash (debit) = 45731.25
notes receivable (credit) = 4500
interest revenue (credit) = 731.25
working note :
interest revenue = 4500 * 6.5% * 90/360
=731.25
Amount of Bad debt expense adjusting entry = $11,055
Ending allowance for Doubtful accounts = $11,055
Less :Beginning allowance for doubtful accounts = $12,200
Bad debt expense = $11,055
Note:
Ending allowance for Doubtful accounts = $ 152500 * 8%
=$12,200
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