Managerial accounting On May 15, Maynard Co. borrowed cash from Texas Bank by issuing a60-day note with a face amount of $100,000.a. Determine the proceeds of the note, assuming that the note carries aninterest rate of 6%.b. Determine the proceeds of the note, assuming that the note isdiscounted at 6%.

Part (a): Proceeds CalculationFor Part (a), when a loan note is issued and the interest is not…

Answered: On May 15, Maynard Co. borrowed cash…

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

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Chapter17: Accounting For Notes And Interest

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Problem 1CE

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On June 1, Phillips Corporation sold, with recourse, a note receivable from a customer to a bank. The note has a face value of 15,000 and a maturity value (principal plus interest) of 15,400. The discount is calculated to be 385, and the accrued interest income is 100. The recourse liability is estimated to be 1,000. Prepare the journal entry of Phillips to record the sale of the note receivable.
A company collects an honored note with a maturity date of 24 months from establishment, a 10% interest rate, and an initial loan amount of $30,000. Which accounts are used to record collection of the honored note at maturity date? A. Interest Revenue, Interest Expense, Cash B. Interest Receivable, Cash, Notes Receivable C. Interest Revenue, Interest Receivable, Cash, Notes Receivable D. Notes Receivable, Interest Revenue, Cash, Interest Expense
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On May 15, Maynard Co. borrowed cash from Texas Bank by issuing a 60-day note with a face amount of $100,000. a. Determine the proceeds of the note, assuming that the note carries an interest rate of 6%. b. Determine the proceeds of the note, assuming that the note is discounted at 6%.