E5-29A (Apply GAAP for notes receivable) Record the following note receivable tr
ID: 2450171 • Letter: E
Question
E5-29A
(Apply GAAP for notes receivable) Record the following note receivable transactions in the journal of Arabian Realty. How much interest revenue did Arabian earn this year? Use a 365-day year for interest computations, and round interest amounts to the nearest dollar. Arabian Realty has an October 31 fiscal year-end.
Aug 1 Loaned $10,000 cash to Candace Smith on a one-year, 7% note. Oct 6 Performed service for Putt Pro, receiving a 90-day, 6% note for $15,000. Oct 16 Received a $2,000, six-month, 11% note on account from Vernon, Inc. Oct 31 Accrued interest revenue for the year.Explanation / Answer
Interest revenue earned during this year is $133.
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