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34kurt
3 years ago
5

Valley Spa purchased $11,700 in plumbing components from Tubman Co. Valley Spa signed a 60-day, 14% promissory note for $11,700.

If the note is dishonored, but Tubman intends to continue collection efforts, what is the journal entry to record the dishonored note? (Use 360 days a year.)
Business
1 answer:
Charra [1.4K]3 years ago
6 0

Answer:

Given that,

Value of promissory note = $11,700

Time period = 60 days

Interest rate = 14%

Interest revenue:

= Note value × Interest rate × Time period

= $11,700 × 0.14 × (60/360)

= $273

Therefore, the journal entry is as follows:

Accounts receivable A/c Dr. $11,973

          To Interest revenue                  $273

          To Notes receivable                 $11,700

(To record the dishonored note)

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Answer:

Explanation:

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8 0
3 years ago
A bond has a $1,000 par value, 20 years to maturity, and a 5 nnual coupon and sells for $860. What is its yield to maturity (ytm
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First, find YTM

N = 20

I = YTM

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PMT = 50

FV = 1000

YTM = 6.245%

The price after 5 years is nothing but the future value of the bond after 5 years

N = 5

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PV = -860

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So the answer is $881.00

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8 0
1 year ago
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