Barrel Enterprises Was Unable to Collect a $1,900 Note Receivable

question 63

Multiple Choice

Barrel Enterprises was unable to collect a $1,900 note receivable plus $80 interest on the maturity date, but hoped to collect the amount in the future. Barrel Enterprises should record this event on the maturity date as:

• A) debit Bad Debts Expense $1,900; credit Notes Receivable $1,900.
• B) debit Allowance for Doubtful Accounts $1,980; credit Notes Receivable $1,980.
• C) debit Accounts Receivable $1,900; debit Interest Income $80; credit Cash $1,980.
• D) debit Accounts Receivable $1,980; credit Interest Income $80; credit Notes Receivable $1,900.

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Definitions:

Consumers

Individuals or entities that purchase goods and services for personal use and not for manufacture or resale.

Macroeconomic Analysis

The examination and interpretation of economic trends and policies at the scale of an entire economy, focusing on phenomena like inflation, unemployment, and Gross Domestic Product (GDP).

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