Give a 2-3 sentence comment for this: a dishonored note. If the note is not paid or renewed at maturity by the maker it is dishonored. The maker is still liable to the payee for the amount of the note plus interest, except it loses its legal status. This means that the note will then move from Notes Receivable to Accounts Receivable. To record this in a journal, you would debit accounts receivable for the total amount, credit Notes receivable for the principal amount, and also credit interest revenue for the amount that represents the difference between the maturity and principal amount. This has to be done even if the amount is not yet collected