Chapter 8, Problem 8.32AP

(1)

To determine

Note receivable:

Note receivable refers to a written promise for the amounts to be received within a stipulated period of time. This written promise is issued by a debtor or borrower to lender or creditor. Notes receivable is an asset of a business.

Interest on note:

Interest on note is the amount charged on the principal value of note for the privilege of borrowing money. Interest is to be paid by the borrower and to be received by the lender.

Maturity date:

Maturity date is the due date on note, on due date the borrower is supposed to repay the face value of the note along with interest.

The amount of maturity date and maturity value of each note.

(2) (3)

To determine

To journalize:  The entries, to record the establishment of note receivable, accrued interest revenue as on December 31, 2016, and collection of cash on principal and interest at maturity.