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
Frequently Asked Questions
What scientific concept do you need to know in order to solve this problem?
Our tutors have indicated that to solve this problem you will need to apply the Notes Payable concept. You can view video lessons to learn Notes Payable. Or if you need more Notes Payable practice, you can also practice Notes Payable practice problems.
What is the difficulty of this problem?
Our tutors rated the difficulty ofABC Company borrowed on a 6 month, 10% note payable for $5,0...as low difficulty.
What professor is this problem relevant for?
Based on our data, we think this problem is relevant for Professor All Professors' class at USF.