A company pays $18,000 in interest on notes, consisting of $12,000 interest that was accrued during the last accounting period and $6,000 of interest that accumulated during the current accounting period but has not yet been accrued on the books. The journal entry for the interest payment should:
A. debit Interest Expense for $18,000 and credit Cash for $18,000.
B. debit Cash for $18,000 and credit Interest Payable for $18,000.
C. debit Interest Payable for $12,000, debit Accrued Interest $6,000 and credit Cash for $18,000.
D. debit Interest Expense for $6,000, debit Interest Payable $12,000 and credit Cash for $18,000.
Answer: D
You might also like to view...
A $6,700, 8.5% note is dated April 10 and is due in 75 days. The maturity value of the note would be
a. $6,800.00. b. $6,818.65. c. $7,500.00. d. $7,075.00.
FASB's definition of fair value of an asset is characterized as a measure of market-based exit value, which is the amount for which a company could sell the asset
Indicate whether the statement is true or false
In accounting for a long-term construction contract for which there is a projected profit, the balance in the Construction in Progress account at the end of the first year of work using the percentage-of-completion method would be
a. zero. b. the same as the completed-contract method. c. higher than the completed-contract method. d. lower than the completed-contract method.
As it is Min-hae’s first time meditating, what should she do with respect to the breaths she takes during meditation?
a. Nothing; she should simply take breaths. b. Count them up to a specific number, then repeat. c. Chant a calming Buddhist phrase with each breath. d. Hum while exhaling.