On the first day of January, Harris, Inc. borrowed $2,000 on a one-year note payable bearing interest at 7% per year. The note specifies that principal and interest must be paid in full at the end of the one-year period. On June 30, the adjusted trial balance will show Interest Payable of ________.
A) $70 credit
B) $70 debit
C) $140 credit
D) $140 debit
A .Interest Payable = $2,000 x 7% x 6/12 = $70
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A. When funds are returned to the donor. B. At the end of each fiscal year. C. When all donor conditions have been met. D. As assets are spent for the purposes intended by the donor.
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