Question

On November 1, Orpheum Company accepted a $10,900, 90-day, 12% note from a customer to settle an account. What entry should be made on the November 1 to record the note acceptance

Answer 1

Note Receivable $10,900 (debit)

Sales Revenue $10,900 (credit)

Step-by-step explanation:

Recognize the Asset : Note Receivable and Sales Revenue to the amount of the value of the note of $10,900.

Subsequently, the Interest will accrue on the note capitalized at the rate of 12%.