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Note receivable:
Note receivable refers to a written promise by a debtor for the amounts to be received within a stipulated period of time. This written promise is issued by a debtor or borrower to the lender or creditor. Notes receivable is an asset of a business.
Interest on note:
Interest on note is the amount charged on the principal value of note for the privilege of borrowing money. Interest is to be paid by the borrower and to be received by the lender.
The amount of interest on notes receivables can be calculated using the following formula:
The amount of interest revenue earned during 2016, for each of the notes receivable.
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Chapter 8 Solutions
Horngren's Financial & Managerial Accounting (5th Edition)
- Determine the due date and the amount of interest due at maturity on the following notes dated in 2016:arrow_forwardWhat is the carrying amount of the loan Receivable on December 31, 2017?arrow_forwardAccounting for notes receivable and accruing interest Carley Realty loaned money and received the following notes during 2018. Determine the maturity date and maturity value of each note. Journalize the entries to establish each Note Receivable and to record collection of principal and interest at maturity. Include a single adjusting entry on December 31, 2018, the fiscal year-end, to record accrued interest revenue on any applicable note. Explanations are not required. Round to the nearest dollar.arrow_forward
- Accounting for notes receivable and accruing interest Carley Realty loaned money and received the following notes during 2018. Note Date Principal Amount Interest rate term April 1 $6000 7% 1 year Sept 30 $12000 6% 6 month Sept 19 $18000 8% 90 days Requirements Determine the maturity date and maturity value of each note. Journalize the entries to establish each Note Receivable and to record collection of principal and interest at maturity. Include a single adjusting entry on December 31, 2018, the fiscal year-end, to record accrued interest revenue on any applicable note. Explanations are not required. Round to the nearest dollar.arrow_forwardThe current portion of long-term notes receivable as of December 31, 2018 isarrow_forwardDetermine due date and interest on notes Determine the due date and the amount of interest due at maturity on the following notes: Date of note A. January 10* B . March 19 C. June 5 D. September 8 E. November 20 * February 2016 has 28 days Face amount A.$40,000 B. 18,000 C. 90,000 D. 36,000 E. $27,000 Interest rate A. 5% B. 8% C. 7% D. 3% E. 4% Term of note A. 90 days B. 180 days C. 30 days D. 90 days E. 60 days Assume 360 days in a year one commuting the interest. Note Due date. Interest (A) __________ $ (B) ___________ $ (C) ___________ $ (D) ____________ $ (E) ___________ $arrow_forward
- South Rims has an accounts receivable balance at the end of 2018 of $357,470. The net credit sales for the year are $769,346. The balance at the end of 2017 was $325,300. What is the accounts receivable turnover rate for 2018 (rounded to two decimal places)? A. 2.02 times B. 2.25 times C. 2.15 times D. 1.13 timesarrow_forwardThe following select financial statement information from Vortex Computing. Compute the accounts receivable turnover ratios and the number of days sales in receivables ratios for 2018 and 2019 (round answers to two decimal places). What do the outcomes tell a potential investor about Vortex Computing if industry average for accounts receivable turnover ratio is 4 times and days sales in receivables ratio is 85 days?arrow_forwardWhat is the total amount to be paid on September 18, 2017, for a loan of 35,000 made on December 23, 2016, at 7%Compute for Exact interest using approximate timearrow_forward
- Vauxall Holdings showed the following information regarding its notes receivable: Note Date of Note Principal Interest Rate Term Maturity Date Days of Accrued Interest at Dec. 31, 2023 Accrued Interest at Dec. 31, 2023* 1 Nov. 1/22 $ 340,000 4.0 % 180 days 2 Jan. 5/23 140,000 5.0% 90 days 3 Nov. 20/23 130,000 4.5% 45 days 4 Dec. 10/23 170,000 5.5% 30 days *Round calculations to the nearest whole cent. Required: For each of Vauxall Holdings note receivable given below: (Do not round intermediate calculations. Round the "Amount of Accrued Interest at Dec. 31, 2023" answers to 2 decimal places.) Determine the maturity date. Calculate the days of accrued interest, if any, at December 31, 2023 (Vauxall Holdings' year-end). Calculate the amount of accrued interest, if any, at December 31, 2023. For Note 3: d. Prepare the entry to record the accrued interest at December 31, 2023. (Do not round intermediate calculations. Round your answers to 2 decimal places.) e. Prepare the entry to record…arrow_forwardWhat is the interest income for 2022? What is the carrying value of the notes receivable on December 31. 2022?arrow_forwardK Bethany Realty loaned money and received the following notes during 2024. (Click the icon to view the notes received.) Read the requirements. Requirement 1. Determine the maturity date and maturity value of each note. (For each applicable note, compute interest using a 365-day year. Round to the nearest dollar.) Note Note (1) Note (2) Note (3) Jun. 19 Date Principal Amount Interest Rate Term Due date Month/Day Year Apr. 1 Sep. 30 $ 18,000 8% 1 year 24,000 12% 6 months 20,000 9% 180 days Data table Principal Note Date Amount Interest Rate Term Note (1) Note (2) Note (3) Jun. 19 Apr. 1 Sep. 30 $ 18,000 8% 1 year 24,000 12% 6 months 20,000 9% 180 days Print Done - ☑ Question Viewerarrow_forward
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