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On January 1, Franz Co. accepted a 30-day, 6% note in the amount of $5,000 from Bria Co., a customer. On January 31, the due date of the note, Bria honors the note and pays in full. The journal entry that Franz would make to record payment of this note would include a: (Check all that apply.) credit to Note Receivable for $5,000. debit to Interest Revenue for $25. credit to Note Receivable for $5,025. credit to Interest Revenue for $25. debit to Cash for $5,025.

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Answer:

The journal entry that Franz would make to record payment of this note would include:

credit to Note Receivable for $5,000

credit to Interest Revenue for $25

debit to Cash for $5,025

Explanation:

Franz Co. accepted a 30-day, 6% note in the amount of $5,000 from Bria Co., on January 1.

The amount of the interest per year = 6% x $5,000 = $300

The amount of the interest per month = $300/12 = $25

On January 31, the due date of the note, Bria honors the note and pays in full. The journal entry to record the collection in Franz Co. :

Debit Cash $5,025

Credit Note Receivable $5,000

Credit Interest revenue $25

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