Question

Hasty and Tasty Foodservice received a 120-day, 8% note for $96,000, dated April 9 from a customer on account. Assume 360 days in a year. a. Determine the due date of the note. b. Determine the maturity value of the note. $fill in the blank a7f48f054fe7fee_2 c. Journalize the entry to record the receipt of the payment of the note at maturity. If an amount box does not require an entry, leave it blank.

Answer 1

a. Month Days

April 21 (30 -9)

May 31

June 30

July 31

August 7

Total 120 days

Thus, due date of the note is August 7

b. Interest = $2,560 [$96,000 * 8% * (120/360)]

Principal = $96,000

Maturity value $98,560

c. Date Account Titles Debit Credit

Aug 7. Cash $98,560

Note receivables $96,000

Interest revenue $2,560