A business issued a 60-day, 7% note for $15,000 to a creditor on account. Illustrate the effects on the accounts and financial statements of recording (a) the issuance if the note and (b) the payment of the note at maturity, including interest.
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A business issued a 60-day, 7% note for $15,000 to a creditor on account. Illustrate the effects on the accounts and financial statements of recording (a) the issuance if the note and (b) the payment of the note at maturity, including interest.
a. An Account Receivable becomes a Note Receivable
b. You receive Cash and the Note Receivable is satisfied. Also you earned Interest Revenue.
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