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Question - Notes Receivable and Interest - Lou's Hardware Store has a fiscal year end of December 31.
October 20, 2010 - Lou's Hardware Store sells inventory to Modern Home Builders and accepts a note receivable for the price of $30,000, 8% for 120 days. The inventory had a cost of $18,500.
December 31, 2010 - Lou's Hardware Store creates an adjusting entry to accrue the interest on the Modern Home Builders note receivable
Maturity Date, 2011 - Lou's Hardware Store collects the amount owing from Modern Home Builders.
Required - Calculate the maturity date for the note receivable and create the journal entries for the transactions listed above.
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