A Promissory Note Is Executed in June

question 102

Multiple Choice

A promissory note is executed in June.When the note is paid the following January,the payee's entry includes (assuming a calendar-year accounting period and no reversing entries) a

• A)debit to Interest Income.
• B)credit to Cash.
• C)credit to Interest Receivable.
• D)debit to Notes Receivable.

---

Definitions:

Merit Pay

Is pay awarded to employees on the basis of the relative value of their contributions to the organization.

Relative Value

The importance or worth of something in comparison to other items, based on its utility, rarity, or desirability.

Sales Commission

A sales commission is an incentive paid to salespeople.

National Security Agency

A U.S. government agency tasked with worldwide surveillance, gathering, and analyzing information and data for overseas intelligence and counterespionage functions.