(L.OBJ. 7) Accounting for notes receivable and accruing interest (35—45 min] Cathy Real...

(L.OBJ. 7) Accounting for notes receivable and accruing interest (35—45 min]

Cathy Realty loaned money and received the following notes during 2010.

Requirements

For each note, compute interest using a 360-day year. Explanations are not required.

1. Determine the due date and maturity value of each note.

2. Journalize the entry to record the inception of the three notes and also journalize a single adjusting entry at October 31, 2010, the fiscal year end, to record accrued interest revenue on all three notes.

3. Journalize the collection of principal and interest at maturity of all three notes.