Immediately after receiving a note from a customer, Ross discounted it at the ba

Question

Immediately after receiving a note from a customer, Ross discounted it at the bank and received the proceeds. Ross’s entry on his books would be to __________.

Question 1 options:

debit Cash and credit Notes Payable

debit Cash, credit Interest Income, and credit Notes Receivable

debit Cash, debit Interest Expense, and credit Notes Receivable

debit Notes Receivable, credit Cash, and credit Interest Income

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Question 2 (2.5 points)

David borrows $2,000 from Matthew and gives him a promissory note. Matthew is the __________.

Question 2 options:

payee

payor

maker

drawer

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Question 3 (2.5 points)

A written promise to pay a certain sum of money to another person or company is a __________.

Question 3 options:

Promissory Accounts Payable

Promissory Note Payable

Promissory Accounts Receivable

Promissory Note Receivable

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Question 4 (2.5 points)

Morris Law Firm is borrowing $10,000 at 6% interest for one year. The $10,000 is the __________.

Question 4 options:

proceeds

principal

amount of interest

net amount

debit Cash and credit Notes Payable

debit Cash, credit Interest Income, and credit Notes Receivable

debit Cash, debit Interest Expense, and credit Notes Receivable

debit Notes Receivable, credit Cash, and credit Interest Income

Explanation / Answer

Answer 1 D. debit Cash, debit Interest Expense, and credit Notes Receivable

Answer 2. D. drawer

Answer 3. B Promissory Note Payable

Answer 4 B principal

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