Multiple Choice
Accent Flooring
The company received a promissory note from a customer on March 1, 2019. The principal amount of the note is $20,000; the terms are 3 months and 9% annual interest.
-Refer to the information for Accent Flooring. At the maturity date, the customer pays the amount due for the note and interest. What entry is required on the books of Accent Flooring on the maturity date assuming that none of the interest had already been recognized?
A) Increase Cash and decrease Notes Receivable by $20,000
B) Increase Cash by $20,450, increase Interest Revenue by $450, and decrease Notes Receivable by $20,000
C) Increase Cash by $20,450, increase Notes Receivable by $20,000, and increase Interest Revenue by $450
D) No entry is required; the customer pays the amount due to Accent Flooring.
Correct Answer:
Verified
Correct Answer:
Verified
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