If note receivable payment dates do not coincide with a company's fiscal year-end,the company must accrue the amount of interest revenue earned as of the fiscal year-end even though it is not receiving the interest payment on this date.

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Accrual accounting requires companies to recognize revenue earned in a given fiscal year, even if payment is not received until a later date. Therefore, if interest revenue is earned on a note receivable but the payment date does not coincide with the fiscal year-end, the company must accrue the amount of interest earned as of the fiscal year-end.

If Note Receivable Payment Dates Do Not Coincide with a Company's