1. Assuming a 360-day year, when a $50,000, 90-day, 9% interest-bearing note payable matures, total payment will be

a) 51,125

b) 4,500

c) 54,500

d) 1,125

2. Chang Co. issued a $50,000, 120-day, discounted note to Guarantee Bank. The discount rate is 6%. Assuming a 360-day year, the cash proceeds to Chang Co. are

a) $49,000

b) $49,750

c) $51,000

d) $47,000

3. The journal entry used to record the issuance of an interest-bearing note for the purpose of borrowing funds for the business is

a) debit Accounts Payable; credit Notes Payable

b) debit Cash; credit Notes Payable

c) debit Notes Payable; credit Cash

d) debit Cash and Interest Expense; credit Notes Payable