Multiple Choice
On September 1,2019,Rowen Manufacturing issued a $90,000,6-month,9% note payable to purchase equipment.At December 31,2019,the company records an adjusting entry to accrue interest incurred by not paid.The company pays the note with interest at the maturity date. What is the entry to record the payment of interest at the maturity date of the note?
A) Debit Notes Payable for $90,000,debit Interest Expense for $8,100,and credit Cash for $98,100.
B) Debit Interest Payable for $2,700,debit Interest Expense for $1,350,and credit Cash for $4,050.
C) Debit Interest Expense for $4,050 and credit Cash for $4,050.
D) Debit Interest Expense for $3,600,debit Interest Payable for $4,500,and credit Cash for $8,100.
Correct Answer:
Verified
Correct Answer:
Verified
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