FDNACCT 05 · Promissory Notes
Conventions
Amounts are Philippine pesos (₱). Use accrual accounting and periodic inventory unless explicitly stated. Interest uses annual rates with days/360 or months/12; maturity dates use actual calendar days, excluding issue date. Cash-discount cases explicitly state the course original-balance convention. Numeric answers omit currency symbols; round monetary answers to two decimal places when needed. Each question supplies its own complete facts and is independent. No VAT or period-end adjustments apply unless stated.
Questions
01Complete the missing interest.
Problem
All amounts are Philippine pesos (₱). The business receives the note for services rendered. Use simple interest and a 360-day year; no interest has been accrued or collected.
| Item | Value |
|---|---|
| Principal | 50,000 |
| Annual interest rate | 4% |
| Term | 90 days |
| Full-term interest | ? |
02Complete the maker’s Cash credit at maturity.
Problem
All amounts are Philippine pesos (₱). The maker pays the note at maturity. Use simple interest and a 360-day year; no interest has been accrued or paid.
| Item | Value |
|---|---|
| Principal | 60,000 |
| Annual interest rate | 5% |
| Term | 120 days |
| Cash credit at maturity | ? |
03Complete the maturity value for Anna’s note.
Problem
All amounts are Philippine pesos (₱). Anna’s overdue trade account is replaced by a note and she pays it at maturity. Use simple interest with months/12; no interest has been accrued or collected.
| Item | Value |
|---|---|
| Principal | 20,000 |
| Annual interest rate | 12% |
| Term | 2 months |
| Maturity value | ? |
04Which account does the payee debit when Sam dishonors the note at maturity?
Problem
All amounts are Philippine pesos (₱). A business receives Sam’s 10,400 note for services rendered. The note bears 10% annual interest for 45 days. Sam dishonors it at maturity. The rate is annual. Use simple interest and a 360-day year. No interest has previously been accrued or collected. Use the course’s ordinary-account treatment of a dishonored note.
05Identify the party that issues the written promise to pay.
Problem
A promissory note names the party promising to pay and the party entitled to receive payment. Identify the term for the party making that promise.
06A ₱120,000 note earns 7% for three months. Enter its maturity value.
Problem
All amounts are Philippine pesos (₱). A business pays a 120,000 note after its full three-month term at 7% annual interest. The rate is annual. Use simple interest with months divided by 12. No interest has previously been accrued or collected.
07Enter full-term interest.
Problem
Use all raw facts in the table. Amounts are pesos unless a row specifies a rate, fraction or term. Apply the stated account, period and viewpoint; no other transactions apply.
| Item | Value |
|---|---|
| Principal | 144000 |
| Annual rate | 8% |
| Term | 75 days |
| Year basis | 360 days |
| Full-term interest | ? |
08Enter cash maturity value.
Problem
Use all raw facts in the table. Amounts are pesos unless a row specifies a rate, fraction or term. Apply the stated account, period and viewpoint; no other transactions apply.
| Item | Value |
|---|---|
| Principal, pesos | 96000 |
| Annual rate | 7.5% |
| Term | 8 months |
| Maturity value, pesos | ? |
09Enter the maker’s Accounts payable credit upon dishonor.
Problem
Maker dishonors a ₱84,000 face note, annual rate 9%, 50-day term, 360-day year. No interest was previously accrued. Apply the course reclassification to ordinary AP.
10Enter the maturity date as Month day, year.
Problem
A 75-day note is dated August 19, 2026. Use actual calendar days, exclude issue date, include maturity date.
11Enter the maturity date as Month day, year.
Problem
A 60-day note is dated December 12, 2026. Use actual calendar days and exclude issue date.
12Complete the Notes receivable credit at collection.
Problem
Use all raw facts in the table. Amounts are pesos unless a row specifies a rate, fraction or term. Apply the stated account, period and viewpoint; no other transactions apply.
| Item | Value |
|---|---|
| Cash maturity value, pesos | 100800 |
| Annual rate | 7.5% |
| Term | 8 months |
| Notes receivable credit, pesos | ? |
13Enter the payee’s net increase in total assets on collection.
Problem
A payee collects a note with face ₱144,000 and full-term interest ₱2,400. None of the interest was accrued previously.
14Enter NEW interest income recognized at collection.
Problem
Use all raw facts in the table. Amounts are pesos unless a row specifies a rate, fraction or term. Apply the stated account, period and viewpoint; no other transactions apply.
| Item | Value |
|---|---|
| Note face | 96000 |
| Annual rate | 7.5% |
| Term | 8 months |
| Interest receivable already recognized | 1800 |
| New interest income | ? |