Allen Inc. took out a one-year, 8%, $100,000 loan on March 31, 2021. Interest is due upon maturity of the loan. What adjusting entry, if any, should Allen Inc. record on December 31, 2021?
A. Debit Interest Expense and credit Interest Payable for $8,000.
B. No adjusting entry is necessary.
C. Debit Interest Expense and credit Interest Payable for $6,000.
D. Debit Interest Expense and credit Interest Payable for $2,000.
Answer: C
You might also like to view...
Which of the following is a highly suspicious financial statement relationship?
a. Increased revenues with decreased inventory. b. Decreased production with decreased scrap. c. Increased revenues with increased receivables d. Decreased cost per unit with increased level of output
Given equal circumstances, which inventory method probably would be the most time consuming?
a. Specific identification b. FIFO c. Average-cost d. LIFO
Using a CRM approach, customers are prioritized and communication customized accordingly
Indicate whether the statement is true or false
Comparative estimates are more accurate than definitive estimates when applied to the same project
Indicate whether the statement is true or false