On January 1, Year 1, Stratton Company borrowed $100,000 on a 10-year, 7% installment note payable. The terms of the note require Stratton to pay 10 equal payments of $14,238 each December 31 for 10 years. The required general journal entry to record the payment on the note on December 31, Year 2 is:

A. Debit Notes Payable $7,000; debit Interest Expense $7,238; credit Cash $14,238.
B. Debit Notes Payable $14,238; credit Cash $14,238.
C. Debit Notes Payable $10,000; debit Interest Expense $4,238; credit Cash $14,238.
D. Debit Interest Expense $7,000; debit Notes Payable $7,238; credit Cash $14,238.
E. Debit Interest Expense $6,493; debit Notes Payable $7,745; credit Cash $14,238.


Answer: E

Business

You might also like to view...

Identify one type of information that might be included in an appendix: ______________

What will be an ideal response?

Business

Roni, who lacks sales experience, has been assigned a mentor, Mark, who has been in the Compu-Tex sales department for ten years

Mark tells Roni that he believes the best way to build long-term relationships with customers is to follow the CARE model. What should Roni most likely do if she takes Mark's advice? A) Emulate Mark's speech and gestures when he gives sales presentations to clients. B) Ask Mark for a list of qualified prospects to improve her chances of closing a sale. C) Use CRM systems to ensure that clients receive software updates. D) Follow through on customer service commitments. E) Use positive self-talk to build her self-esteem.

Business

Microeconomics is the study of

A. global economies. B. the entire U.S. economy. C. the decisions made by individuals. D. the national unemployment rate. E. productivity in other countries.

Business

In Figure 4.3, the factor responsible for the decline in the interest rate is

A) a decline in the price level. B) a decline in income. C) an increase in the money supply. D) a decline in the expected inflation rate.

Business