If the amount due on a note receivable is not collected at maturity,
A) Allowance for Doubtful Accounts should immediately be debited.
B) the note is said to be dishonored.
C) the face value of the note should continue to be carried in the Notes Receivable account until all possible means of collecting the note have been exhausted.
D) Uncollectible Accounts Expense should be debited.

Question

Quizplus · Accepted Answer

When the amount due on a note receivable is not collected at maturity, the note is said to be dishonored. The holder of the note should then take appropriate actions to attempt to collect the debt, such as contacting the maker of the note and possibly taking legal action. In the meantime, the note should be removed from the Notes Receivable account and a new account called "Notes Receivable Dishonored" should be created to reflect the amount of the unpaid principal, any accrued interest, and any fees or costs incurred in attempting to collect the debt.

If the Amount Due on a Note Receivable Is Not