Asked by Jordan Cornelius on Jun 16, 2024
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Lone Star Company received a 90-day, 6% note for $80,000, dated March 12 from a customer on account. (Assume a 360-day year when calculating interest.)(a)Determine the due date of the note.(b)Determine the maturity value of the note.(c)Journalize the entry to record the receipt of the payment of the note at maturity.
90-Day Note
A short-term debt instrument that matures in 90 days, typically used for financing immediate needs.
360-Day Year
The 360-day year is used in financial calculations to simplify interest calculations, assuming each month has 30 days.
Maturity Value
The total amount payable to an investor at the end of a fixed term investment, including the principal and any accrued interest.
- Learn about the economic implications and the act of recording notes receivable, as well as the interest determination and the computation of maturity values.
Verified Answer
TR
![(b)$81,200 [$80,000 + ($80,000 6% - (90/360)] (c)](https://d2lvgg3v3hfg70.cloudfront.net/TB7934/11eb2346_58b5_bc28_aa27_33e3a697acb5_TB7934_00.jpg)
(b)$81,200 [$80,000 + ($80,000 6% - (90/360)]![(b)$81,200 [$80,000 + ($80,000 6% - (90/360)] (c)](https://d2lvgg3v3hfg70.cloudfront.net/TB7934/11eb2346_58b5_e339_aa27_41cbffe736b7_TB7934_00.jpg)
Learning Objectives
- Learn about the economic implications and the act of recording notes receivable, as well as the interest determination and the computation of maturity values.