On May 1, 2018, Fitz installed a $498,000 sound system for International Arena. Fitz agreed to accept a $478,000 six-month, noninterest bearing note due on November 1, 2018. Fitz prepares financial statements at the end of every calendar year. Fitz's journal entry to record the collection of the note plus accrued interest on November 1, 2018, will include a ________.
A) credit to Interest Revenue for $478,000
B) debit to Interest Revenue for $20,000
C) credit to Note Receivable for $498,000
D) credit to Note Receivable for $478,000

Question

Quizplus · Accepted Answer

The note receivable was recorded at $478,000, which is the amount to be credited when the note is collected.

On May 1, 2018, Fitz Installed a $498,000 Sound System