Asked by Franco Sagula on Jun 14, 2024
Verified
When a note receivable is dishonored,it reverts to an account receivable.
Note Receivable Dishonored
Occurs when a debtor fails to fulfill the obligations of a promissory note they have issued.
Account Receivable
Account receivable is the money owed to a business by its customers for goods or services delivered but not yet paid for.
- Comprehend the management and consequences of unpaid notes in the field of accounting.
Verified Answer
LC
Lilia CaddeoJun 18, 2024
Final Answer :
True
Explanation :
This is true. When a note receivable is not paid on the due date, it is considered dishonored and is recorded as an account receivable on the balance sheet.
Learning Objectives
- Comprehend the management and consequences of unpaid notes in the field of accounting.