Exhibit 6-1 O’Martin & Lowry, Inc. Accepted a $150,000, 8%, 90-Day Note

Exhibit 6-1
O’Martin & Lowry, Inc. accepted a $150,000, 8%, 90-day note receivable for services rendered to a client. Thirty days later, O’Martin & Lowry discounted the note at a bank at 10%. Assume interest has not been recognized for the first month.

-Refer to Exhibit 6-1. The entry to record the proceeds from the sale of the note would include a

A) debit to Notes Receivable for $150,000.
B) debit to Cash for $145,000.
C) credit to Interest Receivable for $1,000.
D) credit to Interest Revenue for $1,000.