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alley Spa purchased $10,800 in plumbing components from Tubman Co. Valley Spa signed a 60-day, 10% promissory note for $10,800. If the note is dishonored, but Tubman intends to continue collection efforts, what is the journal entry to record the dishonored note

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tutorAnne

Answer: PLease find the answer below

Explanation:

journal entry to record the dishonored note

Account title                                       Debit                     Credit

Accounts Receivable—Valley Spa $10,980

Interest Revenue                                                             $180

Notes Receivable                                                             $10,800.

Interest Revenue = Principal x rate x period

= 10,800 x 10% x 60/360( using 360 days =1 year)

=$180

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