Adjusting Entries: Accrued Expenses Video Lessons

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Problem: On May 31, Liquid Company needed cash and borrowed $48,000 for 90 days at 6% interest. The adjusting entry necessary when preparing the June 30 financial statement would include: a) a credit to Cash for $240 b) a debit to Interest Expense for $240 c) a debit to Interest Payable for $240 d) a credit to Interest Expense for $240

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On May 31, Liquid Company needed cash and borrowed $48,000 for 90 days at 6% interest. The adjusting entry necessary when preparing the June 30 financial statement would include:

a) a credit to Cash for $240
b) a debit to Interest Expense for $240
c) a debit to Interest Payable for $240
d) a credit to Interest Expense for $240

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