Exam 14: Notes Receivable and Notes Payable

On June 1,Mike's Motorcycle Shop accepted a 120-day,8%,$10,000 note from a customer from the sale of a motorcycle.On July 1,after 30 days,Mike discounted the note at First Bank at 10%.Record the journal entries for Mike's Motorcycles.

On December 16,an 11%,60-day,$2,000 note was issued by Carmen.What entry does Carmen make on December 31 to recognize the interest?

The maturity date for a four-month note dated January 31 is:

The entry to record the cash received on a note discounted at less than face value is to:

A promissory note comes due on the:

For each of the following, identify in Column 1 the category to which the account belongs, in Column 2 the normal balance for the account, in Column 3 the financial statement that the account in which the account balance is reported, and in Column 4 the account's nature (temporary/permanent). - Column 1 Column 2 Column 3 Column 4 Store equipment

If your customer does not pay the note at maturity,the journal entry on your books would be:

Betty's Boutique discounts its own 120-day,6%,$25,000 note payable at a bank.It records the proceeds as:

The proceeds can never be less than the face value.

David borrows $2,000 from Matthew and gives him a promissory note.Matthew is the:

The amount the bank charges when it discounts a note is calculated as:

Interest income is on a merchandise company's income statement under the heading: