Linstrum Company received a 60-day, 9% note for $56,000, dated July 23, from a customer on account.

 PE 9-5A Note Receivable
EE 9-5 Linstrum Company received a 60-day, 9% note for $56,000, dated July 23, from a customer on account.
1.    Determine the due date of the note.

Date of Issue of Note: 23 July
Balance Days in month of July	8	Days
Days in the month of August	31	Days
Days in the month of September	21	Days

 

Answer = Due Date of Note is 21st of September

2.    Determine the maturity value of the note.

Required No. 2

Issue Value of Note	$        56,000
Interest Amount = $ 56,000 X 9% X 60 / 360 Days	$              840
Total	$        56,840

 

Maturity Value = $ 56,840

3.    Journalize the entry to record the receipt of the payment of the note at maturity.

 

Date	ACCT Title and explanation	Debit	Credit
21-Sep	Cash	56,840
	Note Receivable		$     56,000
	Interest Revenue		840
	(To record the receipt of note with interest)

Thanks