On May $10,20$X$1,$ Washington Company received a $90-$day, $8$ percent, $$8,400$ interest$-$bearing note from Whitehead Company in settlement of Whitehead$$s past$-$due account. On June $30,$ Washington discounted this note at City Bank and Trust. The bank charged a discount rate of $13$ percent. On August $8,$ Washington received a notice that Whitehead had paid the note and the interest on the due date.

Required:

Prepare the entries in general journal form to record these transactions.

Analyze:

If the company prepared a balance sheet on July $31,20$X$1,$ how should Notes Receivable$$Discounted be presented on the statement?