61. When a $40,000, 90-day, 9% interest-bearing note payable matures, total payment will amount to:
A. $40,900
B. $43,600
C. $900
D. $3,600
62. Proceeds of $48,750 were received from discounting a $50,000, 90-day note at a bank. The discount rate used by the bank in computing the proceeds was
A. 6.25%
B. 10.00%
C. 10.26%
D. 9.75%
63. Mobile Co. issued a $45,000, 60-day, discounted note to Guarantee Bank. The discount rate is 6%. At maturity, the borrower will pay:
A. $45,450
B. $42,300
C. $45,000
D. $44,550
64. Chang Co. issued a $50,000, 120-day, discounted note to Guarantee Bank. The discount rate is 6%. The cash proceeds to Chang Co. are
A. $49,750
B. $47,000
C. $49,000
D. $51,000
65. The journal entry a company uses to record the issuance of a note for the purpose of converting an existing account payable would be
A. debit Cash; credit Accounts Payable
B. debit Accounts, Payable; credit Cash
C. debit Cash; credit Notes Payable
D. debit Accounts Payable; credit Notes Payable
66. The journal entry a company uses to record the issuance of a note for the purpose of borrowing funds for the business is
A. debit Accounts Payable; credit Notes Payable
B. debit Cash; credit Notes Payable
C. debit Notes Payable; credit Cash
D. debit Cash and Interest Expense; credit Notes Payable
67. The journal entry a company uses to record the issuance of a discounted note for the purpose of borrowing funds for the business is
A. debit Cash and Interest Expense; credit Notes Payable
B. debit Cash and Interest Payable; credit Notes Payable
C. debit Accounts Payable; credit Notes Payable
D. debit Notes Payable; credit Cash
68. The journal entry a company uses to record the payment of a discounted note is
A. debit Notes Payable and Interest Expense; credit Cash
B. debit Notes Payable; credit Cash
C. debit Cash; credit Notes Payable
D. debit Accounts Payable; credit Cash
69. The journal entry a company uses to record the payment of an ordinary note is
A. debit Cash; credit Notes Payable
B. debit Accounts Payable; credit Cash
C. debit Notes Payable and Interest Expense; credit Cash
D. debit Notes Payable and Interest Receivable; credit Cash
70. A current liability is a debt that can reasonably expected to be paid
A. between 6 months and 18 months.
B. out of currently recognized revenues.
C. within one year.
D. out of cash currently on hand.