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Notes Receivable:Calculating the Maturity Date

Brian Krogol
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So like I said notes receivable have two distinct features that accounts receivable don't, there's uh the interest that we just learned how to calculate and the maturity date, there's gonna be a specific date that it's do just like we saw it's going to be doing 90 days. It's gonna be doing nine months, right? That is the due date. So how do we find that due date? Well the maturity date like I said the day the day the note is due and on that due date they're gonna pay the principal plus the interest, everything gets paid on the due date. Okay. They don't pay the interest ahead of time, generally it all happens on the due date. Alright. So let's see how do we find the maturity date of of a note? Okay. They'll they'll usually make you do this and you want to make sure that when you count days, you don't count the day the issue date the very first day. But you do count the maturity date the last day. Okay. It's very simple to do this. So let's go ahead and do this. Find the maturity date of a 60 day note uh issued on July 17. So on july 17th we need to think of how many days are left in the month. Okay So what we do is we're gonna do july 31 minus 17 right? There's 31 total days in july 17 that we're not counting. So 31 minus 17 equals 14 days in july And then how about August August, well we're looking for 60 total days. The whole month of August isn't gonna include that. So that's gonna be another 31 days in August, so that's 31 days now. How many total days do we have so far? 45 days so far? Right. So that means there's we're not gonna get through an entire other month, right? There's only 60 total days on this note. So we want to find out what the last day is gonna be. It's gonna be sometime in September, right? And it's gonna be how many days are left? There's 60 total -45. Well, it's 15 days into September and that is going to be our answer september 15. Okay. So notice how we did that. If it was a longer note, we would have to count a few more months. Right. But you want to keep tally of how many days you've already expired and how many days are left for that final month where it does get paid. Alright, let's go ahead and move on to the next video