Response to the following problem:
Arthur Andersen hold s a 90-doy, 7% note for $1,200 dated April 18that had been received from 8 client on account. On May28, the note is discounted to the Town Bank at a rate of 8%.
Answer the following questions relating to the above information:
1. What is the maturity value of the note?
2. How long did Andersen hold the note?
3. How long did Town Bank hold the note?
4. What is the amount of the discount on the note?
S. Whae is the amount of the net proceeds as a result of discounting the note?
6. What is the general journal entry to be made on May 28 when the note is discounted?