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The maturity value is equal to face value of the note (the
principal) plus interest accrued for the 90-day term of the note.
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On the date a 90-day note is honored, how much cash will the payee
receive?
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Maturity value less the face value
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Face value plus 90 days of interest
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Face value
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Maturity value plus 90 days of interest
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Accounts receivable are reported at net realizable value.
This value is the total amount due less an estimate for doubtful accounts.
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At what value are accounts receivable reported on the balance
sheet?
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Cash (net) realizable value
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Present value
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Maturity value
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Fair market value
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Promissory notes are negotiable instruments, meaning if sold, the
seller can transfer to another party by endorsement.
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Which one of these statements about promissory notes is incorrect?
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A promissory note is not a negotiable instrument.
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The party making the promise to pay is called the maker.
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The party to whom payment is to be made is called the payee.
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A promissory note is more liquid than an account receivable.
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