The Notes Receivable Discounted account
A) is shown as a deduction from Notes Receivable on the balance sheet.
B) has a debit balance.
C) is used to record the amounts due on dishonored notes.
D) is used to record the amount of interest deducted by the bank when a note is discounted.

Question

Quizplus · Accepted Answer

The Notes Receivable Discounted account is shown as a deduction from Notes Receivable on the balance sheet to reflect the contingent liability associated with the discounted notes.

The Notes Receivable Discounted Account