On January 1, Southwest Corp. accepted a one-year note for $70,000 at 5% from one of its customers. When the note matured on December 31, the customer was unable to pay, and the company recorded the dishonor. The amount of the debit recorded on December 31 is ________.

Question

Quizplus · Accepted Answer

The debit recorded on December 31 would be the total amount due, which includes the principal of $70,000 plus the interest for one year at 5%, which is $3,500. Therefore, the total debit is $73,500.