Accounting II
in Other (Other) by vommsYour Price: $8.00 (30% discount)
You Save: $3.43
Description
Chapter 16: Notes Payable / Notes Receivable
NOTES PAYABLE
A note payable is a liability that represents a written promise by the debtor to pay the creditor a specified amount at a specified future date.
Interest is the fee charged for the use of money.
Interest Principal x Rate x Time
Time # of days on note / 360 OR # of months on note / 12
Maturity value is the total amount that must be paid when a note becomes due.
Recording the issuance of a note payable (if you are the borrower): Debit expense account related to purchase Credit Notes Payable Trade
Recording payment of a note payable (and interest): Debit Notes Payable for note amount Debit Interest Expense for interest Credit Cash
Recording Discounted Notes Payable: If a 10K, 6% 60-day note is discounted with...