A note receivable that is sold (i.e.discounted) to obtain early cash must be:

Name: A note receivable that is sold (i.e.discounted) to obtain early cash must be:
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Question

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When a note receivable is sold (discounted), it is considered as a sale of the asset rather than a loan. Therefore, it should be reported as a sale or a loan in the financial statements. This means that the note receivable account is removed from the books and the cash received and any gain or loss on the sale are recorded.

A Note Receivable That Is Sold (I