Arizon Ltd. accepts a three-month, 4%, $7,500 note dated August 1 in settlement of Memon Corporations overdue account. Interest is due at maturity. Arizon records adjusting entries annually and has a September 30 year end.

Required:

(a) Assuming that Memon pays the note and interest in full on November 1, prepare the journal entry for the note and any adjusting journal entries Arizon would make throughout the period that the note is outstanding.

(b) Assuming that Memon could not pay the note but that it was still expected to be collected in the future, prepare the journal entry on November 1.

(c) Assuming that Memon could not pay the note and the note was not expected to be collected in the future, prepare the journal entry on November 1.