Question 1: Bright Co. holds Park Co.’s $20,000, 120 day, 9% note. The entry made by Bright Co. when the note is collected, assuming no interest has previously been accrued is:
Cash 20,000
Notes Receivable 20,000
Accounts Receivable 20,600
Notes Receivable 20,000
Interest Revenue 600
Cash 20,600
Notes Receivable 20,000
Interest Revenue 600
Accounts Receivable 20,600
Notes Revenue 20,000
Interest Revenue 600
Question 2: A building with an appraisal value of $137,000 is made available at an offer price of $142,000. The purchaser acquires the property for $30,000 in cash, a 90-day note payable for $40,000, and a mortgage amounting to $60,000. The cost basis recorded in the buyer's accounting records to recognize this purchase is _______.
- $137,000
- $142,000
- $130,000
- $100,000