Question 1

To obtain cash on delivery, goods may be shipped with a sight draft attached to a(n)----------.

Accepted Answer

The answer of To obtain cash on delivery, goods may...

Question 2

Notes Receivable Discounted is usually shown in the Current Liabilities section of the balance sheet.

Accepted Answer

A) True 
 B)False

Question 3

A---------- is a business document that lists the goods accepted for transportation by a carrier.

Accepted Answer

The answer of A---------- is a business document that lists...

Question 4

Identify the 5 requirements necessary for a promissory note to be considered a "negotiable instrument".

Accepted Answer

1. A promissory note must be in writing

Question 5

The interest on a $5,000 face value, 3-month note bearing interest at 9 percent would be $1,350.

Accepted Answer

A) True 
 B)False

Question 6

On April 1, a firm purchased equipment for $5,000, signing a 60-day note bearing interest at 12 percent. The entry to record the payment of the amount at maturity is (Assume 360 days in a year.)

Accepted Answer

A) a debit to Notes Payable $5,100 and a credit to Cash for $5,100. 
B) a debit to Notes Receivable for $5,000 and a credit to Cash for $5,000. 
C) a debit to Accounts Payable $5,000, a debit to Interest Income for $600, and a credit to Cash for $5,600. 
D) a debit to Notes Payable for $5,000, a debit to Interest Expense for $100, and a credit to Cash for $5,100. 
A) a debit to Notes Payable $5,100 and a credit to Cash for $5,100. 
B) a debit to Notes Receivable for $5,000 and a credit to Cash for $5,000. 
C) a debit to Accounts Payable $5,000, a debit to Interest Income for $600, and a credit to Cash for $5,600. 
D) a debit to Notes Payable for $5,000, a debit to Interest Expense for $100, and a credit to Cash for $5,100.

Question 7

The due date of a 60-day note dated October 15, is

Accepted Answer

A) December 12. 
B) December 13. 
C) December 14. 
D) December 16. 
A) December 12. 
B) December 13. 
C) December 14. 
D) December 16.

Question 8

Compute the maturity value of a 9-month, 9 percent note with a face value of $9,000. (round answer to 2 decimal places)

Accepted Answer

The answer of Compute the maturity value of a 9-month,...

Question 9

Compute the maturity value of a 90-day, 8 percent note with a face value of $6,000.

Accepted Answer

The answer of Compute the maturity value of a 90-day,...

Question 10

If a note payable overlaps financial reporting periods (years), Interest Expense is recorded only in the year the note is paid.

Accepted Answer

A) True 
 B)False

Question 11

The Interest Income account

Accepted Answer

A) is debited when the firm records the effects of a dishonored note receivable. 
B) is usually shown in the Current Assets section of the balance sheet. 
C) usually has a credit balance. 
D) is credited when the firm accepts a note receivable from a customer. 
A) is debited when the firm records the effects of a dishonored note receivable. 
B) is usually shown in the Current Assets section of the balance sheet. 
C) usually has a credit balance. 
D) is credited when the firm accepts a note receivable from a customer.

Question 12

The maturity date of a 90-day note issued May 10 is--------- .

Accepted Answer

The answer of The maturity date of a 90-day note...

Question 13

A(n)----------is a written order that requires the person or business addressed to pay a stated sum of money to another person or firm.

Accepted Answer

The answer of A(n)----------is a written order that requires the...

Question 14

On May 1, a firm purchased equipment for $10,000, signing a 90-day note bearing interest at 12 percent. The entry to record the payment of the amount due on July 30 is (Assume 360 days in a year.)

Accepted Answer

A) debit Equipment $10,000 and a credit to Cash for $10,000. 
B) debit Notes Receivable $11,200 and a credit to Cash for $11,200. 
C) debit Notes Payable $10,000, a debit to Interest Expense for $300, and a credit to Cash for
$10,300. 
D) a debit to Notes Payable $11,200, a debit to Interest Income for $1,200, and a credit to Cash for $11,200. 
A) debit Equipment $10,000 and a credit to Cash for $10,000. 
B) debit Notes Receivable $11,200 and a credit to Cash for $11,200. 
C) debit Notes Payable $10,000, a debit to Interest Expense for $300, and a credit to Cash for
$10,300. 
D) a debit to Notes Payable $11,200, a debit to Interest Income for $1,200, and a credit to Cash for $11,200.

Question 15

The Gaynor Company had the following transactions involving notes payable during 2019. Record the transactions on page 5 of a general journal. Omit descriptions.
Jan. 15 Purchased office equipment from Corporate Outfitters and issued a 180-day, 9 percent note for $16,000.
Apr. 10 Borrowed $13,000 at 12 percent from the Guarantee Bank by discounting a 60-day note payable.
June 9 Paid the note due Guarantee Bank. 
July 14 Paid the note due Corporate Outfitters.

Accepted Answer

The answer of The Gaynor Company had the following transactions...

Question 16

Find the due date of a 120-day note issued on January 18, 2019.

Accepted Answer

The answer of Find the due date of a 120-day...

Question 17

The interest rate stated on a note receivable or note payable is always the interest rate for

Accepted Answer

A) one year. 
B) the exact number of days of the note. 
C) one month. 
D) depends on the terms of the note. 
A) one year. 
B) the exact number of days of the note. 
C) one month. 
D) depends on the terms of the note.

Question 18

Interest Expense is usually classified as a(n)-----------expense on the income statement.

Accepted Answer

The answer of Interest Expense is usually classified as a(n)-----------expense...

Question 19

Compute the maturity value of a 7-month, 6 percent note with a face value of $$9,000. (round answer to 2 decimal places)

Accepted Answer

The answer of Compute the maturity value of a 7-month,...

Question 20

If the amount due on a note receivable is not collected at maturity,

Accepted Answer

A) the note is said to be dishonored. 
B) Allowance for Doubtful Accounts should immediately be debited. 
C) the face value of the note should continue to be carried in the Notes Receivable account until all possible means of collecting the note have been exhausted. 
D) Uncollectible Accounts Expense should be debited. 
A) the note is said to be dishonored. 
B) Allowance for Doubtful Accounts should immediately be debited. 
C) the face value of the note should continue to be carried in the Notes Receivable account until all possible means of collecting the note have been exhausted. 
D) Uncollectible Accounts Expense should be debited.

Exam 16: Notes Payable and Notes Receivable

To obtain cash on delivery, goods may be shipped with a sight draft attached to a(n)----------.

Notes Receivable Discounted is usually shown in the Current Liabilities section of the balance sheet.

A---------- is a business document that lists the goods accepted for transportation by a carrier.

Identify the 5 requirements necessary for a promissory note to be considered a "negotiable instrument".

The interest on a $5,000 face value, 3-month note bearing interest at 9 percent would be $1,350.

On April 1, a firm purchased equipment for $5,000, signing a 60-day note bearing interest at 12 percent. The entry to record the payment of the amount at maturity is (Assume 360 days in a year.)

The due date of a 60-day note dated October 15, is

Compute the maturity value of a 9-month, 9 percent note with a face value of $9,000. (round answer to 2 decimal places)

Compute the maturity value of a 90-day, 8 percent note with a face value of $6,000.

If a note payable overlaps financial reporting periods (years), Interest Expense is recorded only in the year the note is paid.

The Interest Income account

The maturity date of a 90-day note issued May 10 is--------- .

A(n)----------is a written order that requires the person or business addressed to pay a stated sum of money to another person or firm.

On May 1, a firm purchased equipment for $10,000, signing a 90-day note bearing interest at 12 percent. The entry to record the payment of the amount due on July 30 is (Assume 360 days in a year.)

Find the due date of a 120-day note issued on January 18, 2019.

The interest rate stated on a note receivable or note payable is always the interest rate for

Interest Expense is usually classified as a(n)-----------expense on the income statement.

Compute the maturity value of a 7-month, 6 percent note with a face value of $$9,000. (round answer to 2 decimal places)

If the amount due on a note receivable is not collected at maturity,

Accounting: The Language of Business

Analyzing Business Transactions

Analyzing Business Transactions Using T Accounts

The General Journal and the General Ledger

Adjustments and the Worksheet

Closing Entries and Teh Postclosing Trial Balance

Accounting for Sales and Accounts Receivable

Accounting for Purchases and Accounts Payable

Cash Receipts, Cash Payments, and Banking Procedures

Payroll Computations, Records, and Payment

Payroll Taxes, Deposits, and Reports

Accruals, Deferrals, and the Worksheet

Financial Statements and Closing Procedures

Accounting Principles and Reporting Standards

Accounts Receivable and Uncollectible Accounts

Merchandise Inventory

Property, Plant, and Equipment

Accounting for Partnerships

Corporations: Formation and Capital Stock Transactions

Corporate Earnings and Capital Transactions

Long-Term Bonds

Financial Statement Analysis

The Statement of Cash Flows

Departmentalized Profit and Cost Centers

Accounting for Manufacturing Activities

Job Order Cost Accounting

Process Cost Accounting

Controlling Manufacturing Costs: Standard Costs

Cost-Revenue Analysis for Decision Making

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