On April 3, Angel Express issued a 12%, 90-day, $14,000 promissory note. Angel Express should record the payment of the note on the maturity day as: (Use a 360-day year. Do not round any intermediate calculations. Round your final answers to the nearest dollar.)

Question

Quizplus · Accepted Answer

The correct answer is B because the interest on the note is calculated as follows: $14,000 * 12% * (90/360) = $420. Therefore, the total payment is the principal ($14,000) plus the interest ($420), which equals $14,420. This is recorded by debiting Notes Payable for the principal amount, debiting Interest Expense for the interest, and crediting Cash for the total payment.

On April 3, Angel Express Issued a 12%, 90-Day, $14,000