On November 1, Orpheum Company accepted a $12,200, 90-day, 30% note from a customer to settle an account. What entry should be made on the November 1 to record the note acceptance?

On November 1, Orpheum Company accepted a $12,200, 90-day, 30% note from a customer to settle an account. What entry should be made on the November 1 to record the note acceptance?

Debit Cash $12,200; credit Sales $12,200.

Debit Note Receivable $12,200; credit Cash $12,200.

Debit Sales $12,200; credit Accounts Receivable $12,200.

Debit Note Receivable $12,200; credit Sales $12,200.

Debit Note Receivable $12,200; credit Accounts Receivable $12,200.

Answer
Debit Note Receivable $12,200; credit Accounts Receivable $12,200.