EX 9-20 Entries for notes receivable

Oregon Interior Decorators issued a 90-day, 6% note for $90,000, dated April 9, to Corvallis Furniture Company on account.
a. Determine the due date of the note.
b. Determine the maturity value of the note.
c. Journalize the entries to record the following: (1) receipt of the note by Corvallis Furniture and (2) receipt of payment of the note at maturity.

Answer:

a. July 8 (21 + 31 + 30 + 8)

b. $91,350 [($90,000 × 6% × 90/360) + $90,000]

c.
(1)
Notes Receivable.................................................... 90,000    
                    Accounts Rec.—Oregon Interior Decorators  90,000  
(2)
Cash......................................................................... 91,350    
                    Notes Receivable...............................................  90,000    
                    Interest Revenue................................................  1,350

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