If the maker of a note defaults,an entry is made to debit Accounts Receivable and credit Notes Receivable.

Question

Quizplus · Accepted Answer

This is true because when the maker of a note defaults, it means they are unable to pay the amount owed on the note. As a result, the amount owed is transferred from a Note Receivable account to an Accounts Receivable account, which reflects the amount owed by the maker to the recipient of the note.

If the Maker of a Note Defaults,an Entry Is Made