A promissory note is executed in June.When the note is paid the following January,the payee's entry includes (assuming a calendar-year accounting period and no reversing entries)a
A)debit to Interest Income.
B)credit to Cash.
C)credit to Interest Receivable.
D)debit to Notes Receivable.

Question

Quizplus · Accepted Answer

The payee's entry would include a credit to Interest Receivable to recognize the interest income that was accrued in the previous accounting period.

A Promissory Note Is Executed in June