Which of the following is not true regarding promissory notes?
A)Promissory notes are not shown at carrying amount on the statement of financial position.
B)Promissory notes are usually interest-bearing.
C)Promissory notes give a stronger legal claim to the holder than accounts receivable.
D)Promissory notes are frequently accepted from customers who need to extend the payment of an outstanding account receivable.

Question

Quizplus · Accepted Answer

Promissory notes are financial instruments that represent a promise to pay a specific amount of money at a future date, and they are indeed shown at their carrying amount on the statement of financial position. This carrying amount is the face value of the note adjusted for any unamortized discount or premium and any allowance for credit losses.

Which of the Following Is Not True Regarding Promissory Notes