mrahman8
Aug 16, 2013, 10:34 AM
Timothy Company sold merchandise to a customer on October 17 of 2004. They accepted a $4,80
0, 90 day, 10% note as payment. If Timothy Company's accounting period ends on December 31, 2004 [Oct 17 to Dec 31 = 75 days], Timothy Company's journal entry on January 15 ( when the note plus interest is received ) will include:
A) Credit to Interest Revenue for $120
B) Credit to Interest Revenue for $480
C) Credit to Interest Receivable for $20
D) Credit to Interest Receivable for $100
E) Debit to Cash for $5,280
0, 90 day, 10% note as payment. If Timothy Company's accounting period ends on December 31, 2004 [Oct 17 to Dec 31 = 75 days], Timothy Company's journal entry on January 15 ( when the note plus interest is received ) will include:
A) Credit to Interest Revenue for $120
B) Credit to Interest Revenue for $480
C) Credit to Interest Receivable for $20
D) Credit to Interest Receivable for $100
E) Debit to Cash for $5,280