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ololo11
2 months ago
6

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.
Business
1 answer:
harina [3.8K]2 months ago
8 0
On December 1, 2021, the entry for the Note Receivable would be $90,000 on the debit side and $90,000 on the credit side as Service Revenue. On December 1, 2022, $9,000 in cash is recorded for the interest revenue. This continues in the same manner for December 1 of 2023 and 2024. Interest Receivable of $750 is also recorded on the last day of each year for 2021, 2022, and 2023.
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