Question
RecRoom Equipment Company received an $8,000, six-month, 6 percent note to settle an $8,000 unpaid balance owed by a customer. a. The note is accepted
RecRoom Equipment Company received an $8,000, six-month, 6 percent note to settle an $8,000 unpaid balance owed by a customer.
a. | The note is accepted by RecRoom on November 1, causing the company to increase its Notes Receivable and decrease its Accounts Receivable. |
b. | RecRoom adjusts its records for interest its earned to its December 31 year-end. |
c. | RecRoom receives the interest on the note's maturity date. |
d. | RecRoom receives the principal on the note's maturity date. |
Question 1 Make journal entries:
a) Record the receipt of a note on November 1 for $8,000 to settle an outstanding accounts receivable balance of a customer.
b)Record the interest accrued on the note as of December 31.
c)Record the receipt of the interest on the notes maturity date.
d)Record the receipt of the payment for the full principal.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started