An Adjustment That Must Be Made for the Accrued Interest

question 68

Multiple Choice

An adjustment that must be made for the accrued interest on a note receivable would include a:

• A) debit to Note Receivable.
• B) credit to Interest Receivable.
• C) debit to Interest Receivable.
• D) credit to Note Receivable.

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Definitions:

Invests

The act of allocating resources, usually money, in the expectation of generating an income or profit.

Note Payable

A written promise to pay a specified amount of money, along with interest, by a certain date.

Cash Payment

A transaction in which money is paid out or disbursed immediately in cash.

Fees Earned

Revenue generated from providing services, recognized when the service is performed regardless of when the payment is received.