Answer:
Dr. CR.
May 22
Note Payable $7,500
Interest Expense $150
Cash $7650
Explanation:
At the time of maturity the principal amount and the tax on the note will be paid.
Value of Note signed = $7,500
Interest on Note = $7500 x 8% x 90 / 360 (assuming 360 days in a year)
Interest on Note = $150
Total Cash Payment = Principal + Interest
Total Cash Payment = $7,500 + $150
Total Cash Payment = $7,650
