QUESTION 1

Presented below is information from Strong Computers Bhd

July 1 Sold RM30,000 of computers to Smallwood Sdn Bhd with terms 3/15, n/60. Strong
Computers uses the gross method to record cash discounts.
10 Strong Computers received payment from Smallwood for the full amount owed from
the July transactions.
17 Sold RM250,000 in computers and peripherals to the Hanan Store with terms of 2/10,
n/30.
30 The Hanan Store paid Strong Cpmputers for its purchase of July 17

REQUIRED:

Prepare the necessary journal entries for Strong Computers Bhd.

QUESTION 2

Accounts receivable in the amount of RM250,000 were assigned to the Fast Finance Company
by Marsh, Inc., as security for a loan of RM200,000. The finance company charged a 4%
commission on the face amount of the loan, and the note bears interest at 9% per year.

During the first month, Marsh collected RM130,000 on assigned accounts. This amount was
remitted to the finance company along with one month's interest on the note.

REQUIRED:

Make all the entries for Marsh Inc. associated with the transfer of the accounts receivable, the
loan, and the remittance to the finance company.

QUESTION 3

Ende Sutra Bhd factors RM1,000,000 of accounts receivable with Super Bank without recourse
on 1 January 2017. Super Bank will make the collection of account receivables. Super Bank
make finance charge of 3% of the amount of accounts receivable and retains 5% of accounts
receivable to cover sales discounts, returns, and allowances.

REQUIRED:

Prepare the entries to record the above transactions for Ende Sutra Bhd and Super Bank.