The entry to record the dishonor of a note receivable assuming that the payee expects eventual collection includes a debit to

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When a note receivable is dishonored and the payee expects eventual collection, the amount is typically transferred from Notes Receivable to Accounts Receivable, indicating that the company still expects to collect the amount, but now as a regular receivable rather than under the terms of the original note.

The Entry to Record the Dishonor of a Note Receivable