Majesty Productions Accepted a $7,200,120-Day,6% Note from Swartz Studio on March

question 62

Multiple Choice

Majesty Productions accepted a $7,200,120-day,6% note from Swartz Studio on March 1.On the date the note matures,Swartz is unable to pay,but Majesty intends to continue collection efforts.What entry should Majesty record on the maturity date for this dishonored note?

• A)Debit Accounts Receivable $7,200;credit Notes Receivable $7,200.
• B)Debit Accounts Receivable $7,200;credit Allowance for Doubtful Accounts $7,200.
• C)Debit Bad Debt Expense $7,344;credit Notes Receivable $7,344.
• D)Debit Accounts Receivable $7,344;credit Interest Revenue $144;credit Notes Receivable $7,200.
• E)Debit Accounts Receivable $7,056;debit Interest Revenue $144;credit Notes Receivable $7,200.

---

Definitions:

Ethane

A hydrocarbon with the formula C2H6, consisting of two carbon atoms single-bonded together, with three hydrogen atoms bonded to each carbon.

Chain Termination

A process in polymerization or DNA synthesis where growth of the polymer chain is stopped by a terminating molecule.

Ethane

A simple aliphatic hydrocarbon with the formula C2H6, consisting of two carbon atoms single-bonded together and six hydrogen atoms.

UV Light

Ultraviolet light, a type of electromagnetic radiation with a wavelength shorter than visible light but longer than X-rays.