Promissory Note
Accounting glossary · Understand, connect, apply
A promissory note is a written promise by the maker to pay a specified amount to the payee on demand or at a stated future time, according to its terms.
Example
A borrower signs a note for $3,000 with a stated maturity and interest provision.
Remember the difference
Read principal, interest and maturity separately. Legal enforceability and accounting measurement depend on the circumstances.
Updated 3 November 2026. Examples are simplified for learning. Where a term depends on US law, IFRS, US GAAP or a historical rule, check the context explained above and the requirements relevant to your course.
Study references: OpenStax financial accounting and managerial accounting. For reporting requirements, consult the applicable IFRS Standards or FASB guidance. US tax terms should be checked against the relevant tax-year IRS instructions.
← Return to the accounting glossary