On November 1, Year 1, Salem Corporation sold land priced at $540,000 in exchange for a...
On November 1, Year 1, Salem Corporation sold land priced at $540,000 in exchange for a 6%, six-month note receivable.
Salem's balance sheet at December 31, Year 1, includes which of the following as a result of the sale of land on November 1?
Multiple Choice
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Notes Receivable of $540,000 only.
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Notes Receivable of $540,000 and Interest Receivable of $5,400.
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Notes Receivable of $540,000 and Interest Receivable of $16,200.
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Notes Receivable of $556,200 and Interest Receivable of $5,400.
Homework Answers
Interest receivable = $540,000 * 6% * 2 / 12 = $5,400
The answer is Notes Receivable of $540,000 and Interest Receivable of $5,400.
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On November 1, Year 1, Salem Corporation sold land priced at
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