On December 1,2014,Parsons Sales Sold Machinery to a Customer for $2,000.The

question 71

Multiple Choice

On December 1,2014,Parsons Sales sold machinery to a customer for $2,000.The customer could not pay at the time of sale,but agreed to pay 9 months later,and signed a 9-month note at 12% interest.How much interest revenue was earned for the entire term of the note?

• A) $180
• B) $75
• C) $160
• D) $90

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Definitions:

UCC

The Uniform Commercial Code is an extensive collection of regulations that oversee commercial dealings within the United States.

Risk of Loss

The potential for an asset to decrease in value or for a financial loss to occur in a transaction.

Reimbursed

Repaid or compensated for expenses or losses incurred.

Contract

An agreement legally recognized and enforceable, made between two or more parties.