Question 1

The maturity value of a 120-day note for $18,000 that bears interest at 12 percent is

Accepted Answer

A) $18,000. 
B) $20,160. 
C) $18,720. 
D) $17,280. 
A) $18,000. 
B) $20,160. 
C) $18,720. 
D) $17,280.

Question 2

The maturity value of a $90,000 face value, 90-day note bearing interest at 9 percent is (Assume 360 days in a year.)

Accepted Answer

A) $2,025. 
B) $8,100. 
C) $98,100. 
D) $92,025. 
A) $2,025. 
B) $8,100. 
C) $98,100. 
D) $92,025.

Question 3

The amount of cash received at maturity for a $5,000, 90-day, 6 percent note receivable is $75.

Accepted Answer

A) True 
 B)False

Question 4

The maturity value of a 90-day note for $4,000 that bears interest at 10 percent is (Assume 360 days in a year.)

Accepted Answer

A) $4,400. 
B) $4,100. 
C) $4,000. 
D) $3,900. 
A) $4,400. 
B) $4,100. 
C) $4,000. 
D) $3,900.

Question 5

Compute the amount of interest owed on a 120-day, 8 percent note for $18,000.

Accepted Answer

The answer of Compute the amount of interest owed on...

Question 6

The maturity value of a 180-day note for $8,000 that bears interest at 10 percent is (Assume 360 days in a year.)

Accepted Answer

A) $8,800. 
B) $8,400. 
C) $8,000. 
D) $7,600. 
A) $8,800. 
B) $8,400. 
C) $8,000. 
D) $7,600.

Question 7

The interest on a $20,000 face value, 90-day note that bears interest at 9 percent is?

Accepted Answer

A) $300 
B) $450 
C) $900 
D) $1,800 
A) $300 
B) $450 
C) $900 
D) $1,800

Question 8

The interest on a $40,000 face value, 120-day note that bears interest at 8 percent (Rounded to the nearest dollar. Assume 360 days in a year.)is

Accepted Answer

A) $3,200. 
B) $1,067. 
C) $900. 
D) $267. 
A) $3,200. 
B) $1,067. 
C) $900. 
D) $267.

Question 9

The dollar amount shown on an interest-bearing note is called the principal, or--------- value.

Accepted Answer

The answer of The dollar amount shown on an interest-bearing...

Question 10

A ------------is a commercial draft that is payable during a specified period of time.

Accepted Answer

The answer of A ------------is a commercial draft that is...

Question 11

Interest Expense usually appears on the income statement as a non-operating expense.

Accepted Answer

A) True 
 B)False

Question 12

A firm purchased equipment for $16,000 on credit and issued a 120-day note bearing interest at 9 percent as evidence of the debt. The journal entry to record this transaction is

Accepted Answer

A) debit Equipment for $16,000 and credit Accounts Payable for $16,000. 
B) debit Equipment for $16,480 and credit Notes Payable for $16,480. 
C) debit Equipment for $16,000, and credit Notes Payable for $16,000. 
D) Equipment for $16,000, debit Interest Expense for $1,440, and credit Notes Payable for
$17,440. 
A) debit Equipment for $16,000 and credit Accounts Payable for $16,000. 
B) debit Equipment for $16,480 and credit Notes Payable for $16,480. 
C) debit Equipment for $16,000, and credit Notes Payable for $16,000. 
D) Equipment for $16,000, debit Interest Expense for $1,440, and credit Notes Payable for
$17,440.

Question 13

A 60-day note dated April 1 was turned over to the bank for discounting on April 21. The number of days used in computing the dollar amount of the discount is

Accepted Answer

A) 20. 
B) 40. 
C) 60. 
D) 30. 
A) 20. 
B) 40. 
C) 60. 
D) 30.

Question 14

On March 10, 2019, the Westwood Company accepted a 60-day, 9 percent note from Pete Houghton in settlement of his past-due account for $6,000. On April 9, Westwood Company discounted the note at the First National Bank. The bank charged a discount rate of 12 percent. Answer the following questions.
1. What is the maturity date of the note?
2. What is the maturity value of the note?
3. How many days are in the discount period?
4. What is the amount of the discount?
5. What is the amount of the proceeds?

Accepted Answer

1. May 9, 2019; 2. $

Question 15

A 3-month note payable is classified as a(n)-----------on the balance sheet.

Accepted Answer

The answer of A 3-month note payable is classified as...

Question 16

A journal entry is recorded at the time a sight draft is issued.

Accepted Answer

A) True 
 B)False

Question 17

When a note receivable is discounted, the net proceeds are computed by subtracting the discount charges from the-------- of the note.

Accepted Answer

The answer of When a note receivable is discounted, the...

Question 18

If a note is not paid at maturity, it is said to be--------- .

Accepted Answer

The answer of If a note is not paid at...

Question 19

The amount of interest that will accumulate on an $8,000 face value, 30-day note bearing interest at 12 percent is--------- .

Accepted Answer

The answer of The amount of interest that will accumulate...

Question 20

The journal entry to record the issue a promissory note, includes a credit to Note Payable for the

Accepted Answer

A) maturity value of the note. 
B) face value of the note plus the interest that will accrue. 
C) face value less the interest that will accrue. 
D) face value of the note. 
A) maturity value of the note. 
B) face value of the note plus the interest that will accrue. 
C) face value less the interest that will accrue. 
D) face value of the note.

Exam 16: Notes Payable and Notes Receivable

The maturity value of a 120-day note for $18,000 that bears interest at 12 percent is

The maturity value of a $90,000 face value, 90-day note bearing interest at 9 percent is (Assume 360 days in a year.)

The amount of cash received at maturity for a $5,000, 90-day, 6 percent note receivable is $75.

The maturity value of a 90-day note for $4,000 that bears interest at 10 percent is (Assume 360 days in a year.)

Compute the amount of interest owed on a 120-day, 8 percent note for $18,000.

The maturity value of a 180-day note for $8,000 that bears interest at 10 percent is (Assume 360 days in a year.)

The interest on a $20,000 face value, 90-day note that bears interest at 9 percent is?

The interest on a $40,000 face value, 120-day note that bears interest at 8 percent (Rounded to the nearest dollar. Assume 360 days in a year.)is

The dollar amount shown on an interest-bearing note is called the principal, or--------- value.

A ------------is a commercial draft that is payable during a specified period of time.

Interest Expense usually appears on the income statement as a non-operating expense.

A firm purchased equipment for $16,000 on credit and issued a 120-day note bearing interest at 9 percent as evidence of the debt. The journal entry to record this transaction is

A 60-day note dated April 1 was turned over to the bank for discounting on April 21. The number of days used in computing the dollar amount of the discount is

A 3-month note payable is classified as a(n)-----------on the balance sheet.

A journal entry is recorded at the time a sight draft is issued.

When a note receivable is discounted, the net proceeds are computed by subtracting the discount charges from the-------- of the note.

If a note is not paid at maturity, it is said to be--------- .

The amount of interest that will accumulate on an $8,000 face value, 30-day note bearing interest at 12 percent is--------- .

The journal entry to record the issue a promissory note, includes a credit to Note Payable for the

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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