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The flyer businesses will receive a $500,000 loan from First National Bank on January 1. Flyer Enterprises signs a 6%, 9-month note for $500,000. the transaction recorded by Flyer Enterprises on January 1 to reflect the sale of the note's proceeds and its issuance is
Cash A/c- (dr) 500,000
Notes Payable- (cr) 500,000
What exactly do the note's revenues mean?
Note Proceeds are the funds the customer gets after selling a subordinate PIK note or subordinated cash pay note to a seller.
The term "lend out" does not apply to banks. Lending is a form of "creating fresh money out of nothing." The aggregate principal amount of each loan is equal to the amount of freshly created money. Banks are the only ones who "lend out" reserves to one another.
In order to raise money, your lender could sell your debt. Banks really transfer servicing rights to debtors when they sell loans. Because of this, credit lines are made available, enabling lenders to lend the money to more customers (and profit from the fees associated with originating a mortgage).
Learn more about sale of the note's proceeds: https://brainly.com/question/28025497
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