Kingbird, Inc. accepts from Gates Stores a $6.400, 4-month, 10% note dated May 3

Question

Kingbird, Inc. accepts from Gates Stores a $6.400, 4-month, 10% note dated May 31 in settlement of Gates, overdue account. The maturity date of the note Is September 30. (a) Your answer is correct. Calculate the interest payable at maturity. (Round answer to o decimal places, e.g. s155. Interest payable at maturity LIST OF ACCOUNTS Attempts: 1 of 3 used (b) What entry does Kingbird, Ic. make at the maturity date, assuming Gates pays the note and interest in full at that time? (Credit account titles are automatically indented when amount is entered. Do not indent manually. Round answer to o decimal places, e.g. 152.) Account Titles and Explanation Debit Credit

Explanation / Answer

Interest payable on maturity 6400*10%*4/12 = 213.33 or 213

Bank/cash ac debit with 6613

Credit 10% note of gates 6400

Credit interest income 213

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