Evergreen Company sells lawn and garden products to wholesalers. The company's fiscal year-end is December 31. During 20

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Evergreen Company sells lawn and garden products to wholesalers.
The company's fiscal year-end is December 31. During 2021, the
following transactions related to receivables occurred:
Sold merchandise to Lennox, Inc., for $24,000 and accepted a 8%,
7-month note. 8% is an appropriate rate for this type of note.
Sold merchandise to Maddox Co. that had a fair value of $16,560,
and accepted a noninterest-bearing note for which $18,000 payment
is due on March 31, 2022.
Sold merchandise to Carr Co. for $12,000 with terms 2/10, n/30.
Evergreen uses the gross method to account for cash
discounts.
Discounted the Lennox, Inc., note at the bank. The bank’s
discount rate is 10%. The note was discounted without recourse.
Required:
1. Prepare the necessary journal entries for
Evergreen for each of the above dates. For transactions involving
the sale of merchandise, ignore the entry for the cost of goods
sold.
2. Prepare any necessary adjusting entries at
December 31, 2021. Adjusting entries are only recorded at
year-end.
3. Prepare a schedule showing the effect of
the journal entries on 2021 income before taxes.