Asked by Christian Broussard on Jun 01, 2024
Verified
When a note receivable is honored Cash is debited for the note's
A) net realizable value.
B) maturity value.
C) gross realizable value.
D) face value.
Maturity Value
The amount payable to an investor at a security's maturity date, including principal and any remaining interest.
Cash Debited
An accounting entry that increases the cash balance in a company's ledger.
- Comprehend the accounting treatment of notes receivable at maturity.
Verified Answer
EO
Elizabeth OrozcoJun 07, 2024
Final Answer :
B
Explanation :
When a note receivable is honored, Cash is debited for the note's maturity value, which includes both the principal amount (face value) and any accrued interest.
Learning Objectives
- Comprehend the accounting treatment of notes receivable at maturity.
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