Asked by Kaylee Rabon on May 01, 2024
Verified
Roseland Design borrowed $700,000 on a 90-day note from CorpOne Funding Company. CorpOne discounts the note at 8%. (Assume a 360-day year is used for interest calculations.)
(a) Journalize Roseland’s entries to record:
a. The issuance of the note.
b. The payment of the note at maturity.
(b) Journalize CorpOne’s entries to record:
a. The receipt of the note.
b. The receipt of the payment of the note at maturity.
Note Discounted
A financial term referring to a promissory note that is sold for less than its face value before it reaches maturity.
Interest Calculations
The process of figuring out the amount of interest to be added to the principal amount of a loan or deposit, based on the rate and the time.
Payment Maturity
The date on which a financial obligation must be repaid in full.
- Employ interest computation methods on notes payable and receivable to ascertain the amounts of proceeds and payments.
Verified Answer
TN
Learning Objectives
- Employ interest computation methods on notes payable and receivable to ascertain the amounts of proceeds and payments.