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Customer gave seller a 12 % promissory note for $ 90 0000 owed. The note calls for interest to accrue at the rate of 12% per annum, all payable upon the maturity date ( sEpt 17)


The question is, do I need to adjust the journal at the end of every month or do I need to wait until Sept 17 ?

Thanks in advance

Well, if you're creating financial statements every month, you'd need to make adjusting entries at the end of every month to get the right expenses and payables in the income statement and balance sheet. But if you're making the financial statements at the end of the year (sept 17), you don't need to make adjusting entries for every month. That's my understanding.

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Originally Posted by John_eard

Help


Customer gave seller a 12 % promissory note for $ 90 0000 owed. The note calls for interest to accrue at the rate of 12% per annum, all payable upon the maturity date ( sEpt 17)


The question is, do i need to adjust the journal at the end of every month or do i need to wait until Sept 17 ?

Thanks in advance

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Well no because the problem says payable in maturity day which is September 17 , so just record the interest and the payable by that date.