On December 1, 2021, Liang Chemical provides services to a customer for $90,000. In payment for the services, the customer signs a three-year, 10% note. The face amount is due at the end of the third year, while annual interest is due each December 1. Required: Record the acceptance of the note on December 1, 2021. Record the interest collected on December 1 for 2022 and 2023, and the adjustment for interest revenue on December 31 for 2021, 2022, and 2023. Record the cash collection on December 1, 2024.
On December 1, 2021, Liang Chemical provides services to a customer for $90,000. In payment for the services, the customer signs a three-year, 10% note. The face amount is due at the end of the third year, while annual interest is due each December 1. Required: Record the acceptance of the note on December 1, 2021. Record the interest collected on December 1 for 2022 and 2023, and the adjustment for interest revenue on December 31 for 2021, 2022, and 2023. Record the cash collection on December 1, 2024.
Chapter9: Accounting For Receivables
Section: Chapter Questions
Problem 24Q: Chemical Enterprises issues a note in the amount of $156,000 to a customer on January 1, 2018. Terms...
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On December 1, 2021, Liang Chemical provides services to a customer for $90,000. In payment for the services, the customer signs a three-year, 10% note. The face amount is due at the end of the third year, while annual interest is due each December 1.
Required:
- Record the acceptance of the note on December 1, 2021.
- Record the interest collected on December 1 for 2022 and 2023, and the adjustment for interest revenue on December 31 for 2021, 2022, and 2023.
- Record the cash collection on December 1, 2024.
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