The cash to be received by sundland ocmpany when the note becomes due is $ 5814
What is difference between account receivable and note receivable?
- Accounts receivable, which represents the money owed by customers, differs significantly from notes receivable, which is a written guarantee by a provider to pay a specific amount of money in the future.
- A note receivable is an asset account linked to an underlying promissory note that specifies in writing the terms of payment for a purchase between the "maker" of the note and the "payee," who is normally a business and is occasionally referred to as a creditor (usually a customer or employee, and sometimes called a debtor).
given :
sunland company received = 5700
6% of 5700 = 342 per year
per month = 342/12 =28.5
four month note receivable the cash to be recieved by sundland ocmpany =28.5 * 4 + 5700 = $5814
the cash to be recieved by sundland ocmpany when the note becomes due is $ 5814
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