A company lends its supplier $166,000 for 3 years at a 10% annual interest rate. Interest payments are to be made twice a year. The entry to record the establishment of the loan includes a debit to: Multiple Choice O O Cash and a credit to Notes Payable for $166,000. Notes Receivable and a credit to Cash for $166,000.
A company lends its supplier $166,000 for 3 years at a 10% annual interest rate. Interest payments are to be made twice a year. The entry to record the establishment of the loan includes a debit to: Multiple Choice O O Cash and a credit to Notes Payable for $166,000. Notes Receivable and a credit to Cash for $166,000.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:A company lends its supplier $166,000 for 3 years at a 10% annual interest rate. Interest
payments are to be made twice a year. The entry to record the establishment of the loan
includes a debit to:
Multiple Choice
Cash and a credit to Notes Payable for $166,000.
Notes Receivable and a credit to Cash for $166,000.
Cash and a credit to Interest Revenue for $16,600.
Interest Receivable and a credit to Interest Revenue for $8,300.
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