Question

on august 2, jun company receives a $7,900, 90 - day, 10.5% note from customer ryan albany as payment on his $7,900 account receivable.

1. compute the maturity date for this note.
2. prepare juns journal entry for august 2.

complete this question by entering your answers in the tabs below.
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compute the maturity date for this note.
compute the maturity date for this note.

Explanation:

Step1: Determine days in August

August has 31 days. Subtract the note - receipt day (August 2) from 31: \(31 - 2=29\) days remaining in August.

Step2: Subtract August days from total days

The note is for 90 days. Subtract the 29 days in August from 90: \(90 - 29 = 61\) days left.

Step3: Determine days in September

September has 30 days. Subtract 30 from the remaining 61 days: \(61-30 = 31\) days left. But October has 31 days, so after 30 days in September, we move to October. Wait, actually, after August (29 days) and September (30 days), the total days accounted for are \(29 + 30=59\) days. Then \(90 - 59 = 31\) days? No, wait, let's recalculate. Wait, August 2 to August 31: 29 days (because August 2 is day 0, so from August 3 to August 31 is 29 days). Then September has 30 days, so 29+30 = 59 days. Then 90 - 59=31 days. But October has 31 days, so the maturity date is October 31? Wait, no, wait, let's do it step - by - step.

Start with August 2.

Day 1: August 3 (1 day after August 2)

We need to count 90 days from August 2.

August: 31 - 2=29 days (from August 3 to August 31)

After August, we have 90 - 29 = 61 days left.

September has 30 days, so after September, we have 61 - 30=31 days left.

October has 31 days, so the 31st day of October is the maturity date. Wait, but October has 31 days, so 29 (August) + 30 (September)+31 (October)=90 days. So the maturity date is October 31? Wait, no, wait, August 2 plus 90 days. Let's calculate the date:

August has 31 days. So from August 2, the number of days to August 31 is \(31 - 2=29\) days.

Then September has 30 days, so total days by September 30: \(29 + 30 = 59\) days.

Then we need \(90-59 = 31\) more days. Since October has 31 days, the maturity date is October 31. Wait, but October 31 is 31 days after September 30. So 29 (August) + 30 (September)+31 (October)=90 days. So the maturity date is October 31? Wait, no, wait, let's check with another approach.

The formula for maturity date of a note: If the note is issued on day \(d\) of month \(m\), with \(t\) days to maturity.

We can also use the following method:

August: 31 days. So from August 2, the remaining days in August: \(31 - 2=29\)

September: 30 days. So 29 + 30 = 59 days used.

Remaining days: \(90 - 59 = 31\)

October has 31 days, so the maturity date is October 31. Wait, but October 31 is 31 days after September 30. So August 2 + 90 days: August (29) + September (30)+October (31)=90. So the maturity date is October 31.

Wait, but let's check with a calendar. August 2, add 90 days.

August: 31 - 2 = 29 (days from Aug 3 to Aug 31)

September: 30 days (total so far: 29+30 = 59)

October: 90 - 59 = 31 days. Since October has 31 days, the 31st of October is the maturity date.

Answer:

The maturity date of the note is October 31.