11)ACCOUNTING PRINCIPLES II course Hamada Company borrows $20,000 on October 1 from Arab bank by signing a$20,000, 10%, six month note payable. The journal entry to record accruedinterest at December 31, assuming adjusting entries are made only at the end ofthe year is:O a. Debit Interest expense 500 and credit Interest payable 500O b. Debit Interest expense 2,000 and credit Interest payable 2,000Oc.Debit Interest expense 1,000 and credit Interest payable 1,000O d. Debit Interest payable 500 and credit Interest expense 500

Given, Amount borrowed = $20,000 Interest Rate = 10%

Hamada Company borrows $20,000 on October 1 from Arab bank by signing a $20,000, 10%, six month note payable. The journal entry to record accrued interest at December 31, assuming adjusting entries are made only at the end of the year is: a. Debit Interest expense 500 and credit Interest payable 500 O b. Debit Interest expense 2,000 and credit Interest payable 2,000 O c. Debit Interest expense 1,000 and credit Interest payable 1,000 O d. Debit Interest payable 500 and credit Interest expense 500

Hamada Company borrows $20,000 on October 1 from Arab bank by signing a $20,000, 10%, six month note payable. The journal entry to record accrued interest at December 31, assuming adjusting entries are made only at the end of the year is: a. Debit Interest expense 500 and credit Interest payable 500 O b. Debit Interest expense 2,000 and credit Interest payable 2,000 O c. Debit Interest expense 1,000 and credit Interest payable 1,000 O d. Debit Interest payable 500 and credit Interest expense 500

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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ACCOUNTING PRINCIPLES II course

Hamada Company borrows $20,000 on October 1 from Arab bank by signing a
$20,000, 10%, six month note payable. The journal entry to record accrued
interest at December 31, assuming adjusting entries are made only at the end of
the year is:
O a. Debit Interest expense 500 and credit Interest payable 500
O b. Debit Interest expense 2,000 and credit Interest payable 2,000
Oc.
Debit Interest expense 1,000 and credit Interest payable 1,000
O d. Debit Interest payable 500 and credit Interest expense 500

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