Response to the following problem:
A promissory note dated December 1, 2002 bearing interest at a rate of 12% and due in 90 days, is scnt to a creditor. The face value of the note is $900.
Determine:
1. The due date of the note;
2. The total interest income that will be earned on the note;
3. Assuming the note is held for thirty days in the old accounting period (December 1-31, 2002), find the interest that would be earned on the note for that period (accrued interest income);
4. Prepare the general journal entry for the receipt of the note;
5. Record the adjusting entry on December 31. 2002 and any neces- sary reversal entries;
6. Record the entry (or the payment of the note by the customer; and
7. Record entries 4, S. and 6 on the books of the customer who issued the note.