Advanced Accounting Chapter 8 Review

A company signed a 90-day note on March 15 of the current year. The maturity date of the note is

• March 15

• June 13

• June 15

• July 10

An entry that is the exact opposite of an adjusting entry is known as a(n)

• closing entry

• general journal entry

• opening entry

• reversing entry

When a note is paid at maturity, the credit is to Cash. The entry debits

• Notes Payable for the maturity value of the note

• Notes Payable for the principal of the note and Interest Payable for the interest due on

  the note

• Notes Payable for the principal of the note and Interest Expense for the interest due on

  the note

• Notes Payable for the maturity value of the note and Interest Expense for the interest due

  on the note

The date on which the principal of a note is due to be repaid is the

• date of a note

• interest date of a note

• maturity date of a note

• principal date of a note

Obtaining capital by borrowing money for a period of time is called

• debt financing

• issuing a note payable

• establishing a line of credit

• issuing a promissory note

An amount paid for the use of money for a period of time is called

• bank charges

• interest

• principal

• security

Expenses paid in one fiscal period but not reported as expenses until a later fiscal period are known as

• accrued expenses

• matching expenses with revenue

• postponed expenses

• prepaid expenses

The original amount of a note is called the

• rate of the note

• maturity value

• principal

• term of the note

The interest accrued on borrowed funds is called

• interest expense

• interest receivable

• interest revenue

• prepaid interest

A written and signed promise to pay a sum of money at a specified time is called a

• secured note

• loan document

• principal

• promissory note