Answer: a. 120 days
b. $185400
Step-by-step explanation:
a. The due date of the note will be:
August = 31-10 = 21 days
September = 30 days
October = 31 days
November = 30 days
December = 8 days
Total = 120 days
b. The maturity value of the note will be:
= 180000 + (180000 × 9% * 120/360)
= 180000 + (180000 × 0.09 × 0.33)
= 180000 + 5346
= 185346
= 185400 to nearest dollar
3. 8 december
Debit Cash $ 185,400
Credit Note Receivable $180,000
Credit Interest Revenue $5,400