On 31 May, 2020, the business borrowed $30,000 on a four year, 5% per annum loan that calls for annual payments of interest every 31st May. Assume the balance day falls on 31 December 2020, the correct journal entry to record the accrued interest on the balance day in 2020 is: (hint: calculate by counting months, not days) Select one: a. Dr Interest expense 750 Cr Interest payable 750 b. Dr Interest expense 1,500 Cr Interest payable 1,500 O c. Dr Cash 30,000 Cr Loan payable 30,000 d. Dr Interest expense 875 Cr Interest payable 875

On 31 May, 2020, the business borrowed $30,000 on a four year, 5% per annum loan that calls for annual payments of interest every 31st May. Assume the balance day falls on 31 December 2020, the correct journal entry to record the accrued interest on the balance day in 2020 is: (hint: calculate by counting months, not days) Select one: a. Dr Interest expense 750 Cr Interest payable 750 b. Dr Interest expense 1,500 Cr Interest payable 1,500 O c. Dr Cash 30,000 Cr Loan payable 30,000 d. Dr Interest expense 875 Cr Interest payable 875

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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