What Is the Holder of the Note's Entry to Record

question 20

Multiple Choice

What is the holder of the note's entry to record a note received, with interest accrued in the previous year (assume there is a reversing entry) ?

• A) Debit Cash; credit Interest Receivable; credit Notes Receivable; credit Interest Income
• B) Debit Notes Payable; debit Interest Expense; debit Interest Payable; credit Cash
• C) Debit Notes Payable; debit Interest Expense; credit Cash
• D) Debit Cash; credit Interest Income; credit Notes Receivable

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Definitions:

Correlation And Causation

A relationship between two variables does not imply that one causes the other; correlation indicates a relationship, whereas causation indicates a cause-and-effect relationship.

Macroeconomics

The branch of economics dealing with the structure, performance, behavior, and decision-making of an economy as a whole, rather than individual markets.

Microeconomics

The branch of economics that studies the behavior of individuals and businesses in making decisions on the allocation of limited resources.

Opportunity Cost

The cost of foregoing the next best alternative when making a decision.