Descriptors are provided below for six situations involving notes receivable being discounted at a bank. In each case, the maturity date of the note is December 31, 2021, and the principal and interest are due at maturity. For each, determine the proceeds received from the bank on discounting the note.
Descriptors are provided below for six situations involving notes receivable being discounted at a bank. In each case, the maturity date of the note is December 31, 2021, and the principal and interest are due at maturity. For each, determine the proceeds received from the bank on discounting the note.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Descriptors are provided below for six situations involving notes receivable being discounted at a bank. In each case, the maturity
date of the note is December 31, 2021, and the principal and interest are due at maturity. For each, determine the proceeds
received from the bank on discounting the note.
Note Note Face Value Date of Note Interest Rate Date Discounted Discount Rate
1
$50,000
3/31/2021
8%
6/30/2021
10%
50,000
3/31/2021
8.
9/30/2021
10
50,000
3/31/2021
8
9/30/2021
12
4
80,000
6/30/2021
10/31/2021
10
80,000
6/30/2021
10/31/2021
12
6.
80,000
6/30/2021
6.
11/30/2021
10
Transcribed Image Text:PROCEEDS RECEIVED
Note Face
Date of
Interest
Date
Discounted
6/30/2021
Discount
Proceeds
Note
Value
Note
Rate
Rate
Received
1
50,000
3/31/2021
8%
10%
50,000
50,000
3/31/2021
8%
9/30/2021
10%
12%
10%
3/31/2021
8%
9/30/2021
4
80,000
80,000
6/30/2021
6%
10/31/2021
5
6/30/2021
6%
10/31/2021
12%
6
80,000
6/30/2021
6%
11/30/2021
10%
Note 1
Face amount
Interest to maturity
Maturity value
Discount
Cash proceeds
Note 2
Face amount
Interest to maturity
Maturity value
Discount
Cash proceeds
Note 3
Face amount
Interest to maturity
Maturity value
Discount
Cash proceeds
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