Heinlein assoc. accepted a two-year interest-bearing note for $1,000,000 on january 1, 2020. the note was accepted as payment for merchandise with a fair value of $1,000,000. the effective interest rate is 7%. interest is paid at the end of each year. the cash collection on december 31, 2021, would be recorded as:

                                   Debit                              Credit

Cash                            1,000,000

Note receivable                                                  1,000,000

Cash                              70,000

Interest receivable                                               70,000

Explanation:

At December 31 2021 it would be the end of maturity of the 2 year note so the note would be have to be paid in full, so Heinlein assoc will receive $1,000,000 in cash for the note. Also because it is the end of the year they will also receive 7% interest which is (0.07*1,000,000)= 70,000

The Heinlein Assoc will debit cash by 1,000,000 and credit the note receivable by the same amount and they will debit 70,000 cash and credit interest receivable by 70,000.

net worth is the difference between what you own and what you have. if you exceed your liabilities you have a positive net worth. if your liabilities are greater than your assets you have a negative net worth. its a snapshot of your financial situation. if you calculate your net worth you will see the end result of everything you've earned and spent as of now. net worth statements and all you asked of can you determine where you are, how to get where you want to be, if your spending   to much. honestly it can tell you a lot of things. i can go on, but you can paint the picture from here.

explanation: