🤓 Based on our data, we think this question is relevant for Professor All Professors' class at USF.
ABC Company borrowed on a 6 month, 10% note payable for $5,000 on 10/1/15. Assuming no adjusting entries were made yet, what adjusting entry for interest will they need to make at year end on 12/31?
a. Debit: Interest expense $500 and Credit: Interest Payable $500
b. Debit: Interest expense $250 and Credit: Int. Payable $250
c. Debit: Interest receivable $250 and Credit: Int. Income $250
d. Debit: Interest expense $125 and Credit: Interest Pay. $125