On May 1, 2012, a company lends $100,000 to one of its main suppliers and accepts a 12-month, 6% note. Record the acceptance of the note on May 1, 2012, the adjustment on December 31, 2012, and the cash collection on May 1, 2013.

Question

Quizplus · Accepted Answer

Interest revenue 2012 = $100,000 $\times$ 6% $\times$ 8/12 = $4,000.
Interest revenue 2013 = $100,000 $\times$ 6% $\times$ 4/12 = $2,000.

On May 1, 2012, a Company Lends $100,000 to One