Register
on april 1, 20x1, nelsen inc. accepts a $100,000, 8% note. the note receivable and interest are due on march 31, 20x2 (one year later). assuming nelson inc. has a december 31 year-end, on march 31, 20x2,
533,001 views
22 votes
22 votes
on april 1, 20x1, nelsen inc. accepts a $100,000, 8% note. the note receivable and interest are due on march 31, 20x2 (one year later). assuming nelson inc. has a december 31 year-end, on march 31, 20x2, nelson inc. will record interest revenue of:

User Nag Raj
by
2.9k points

1 Answer

15 votes
15 votes

Final answer:

Nelsen Inc. will record interest revenue of $8,000 on March 31, 20X2 for a $100,000 note at an 8% interest rate that is due in one year from its issue date.

Step-by-step explanation:

The student's question involves calculating interest revenue for a note receivable that was accepted by Nelsen Inc. On April 1, 20X1, Nelsen Inc. accepted a $100,000 note at an 8% interest rate, due on March 31, 20X2. Since the note is a one-year note, we can calculate the total interest revenue that will be recorded on March 31, 20X2.

The formula to calculate simple interest is:


Interest = Principal × Rate × Time

Using this formula, we get:

Interest = $100,000 × 8% × 1 year

Interest = $100,000 × 0.08

Interest = $8,000

Therefore, on March 31, 20X2, Nelsen Inc. will record interest revenue of $8,000 for the note receivable.

User Haolt
by
2.9k points
Ask a Question
Welcome to QAmmunity.org, where you can ask questions and receive answers from other members of our community.

1.6m questions

2.0m answers

Other Questions

If the rate of inflation in Japan dramatically increases while the rate of inflation in the United States remains constant, then a. the demand curve for dollars shifts to the left. b. the demand curve
If you buy a one-year bond for $4,000 and the issuer pays you back $5,000 at the end of one year, the interest rate on the bond is
The market value of the equity of Hudgins, Inc., is $582,000. The balance sheet shows $21,000 in cash and $192,000 in debt, while the income statement has EBIT of $93,000 and a total of $137,000 in depreciation
Kylie is risk averse and has $1,000 with which to make a financial investment. She has three options. Option A is a risk-free government bond that pays 5 percent interest each year for two years. Option
From the standpoint of the issuing company, a disadvantage of using bonds as a means of long-term financing is that Group of answer choices bond interest is deductible for tax purposes. interest must be
Link Copied!