A business is holding a Bill receivable and wishes to cash it in before its maturity date by selling it to a bank. If the business receives more than the maturity value of the bill, the difference is treated as:

Question

Quizplus · Accepted Answer

The difference received over the maturity value is treated as interest revenue, as it represents the interest earned from selling the bill before its maturity.

A Business Is Holding a Bill Receivable and Wishes to Cash