Ask Question
15 February, 12:33

On October 1, Black Company receives a 9% interest-bearing note from Reese Company to settle a $20,000 account receivable. The not is due in six months. At December 31, Black should record interest revenue of

a. $0

b. $450

c. $900

d. $1800

+1
Answers (1)
  1. 15 February, 15:24
    0
    B. $450

    Explanation:

    Interest rate = 9% = 0.09

    Account receivable = $20,000

    Interest = 0.09 x 20,000

    = $1,800

    At December 31, Black should record interest revenue of

    1,800 x (90/360)

    = 1,800 x 0.25

    = $450

    The answer is $450
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “On October 1, Black Company receives a 9% interest-bearing note from Reese Company to settle a $20,000 account receivable. The not is due ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers