*Use the following information for Multiple Choice Questions 3-4: Kinsella Seed borrowed $200,000 on October 1, 2019, at 10% interest. The interest and principal are due on October 1, 2020. What journal entry should be recorded on December 31, 2019? A. Debit Interest Expense 5,000; credit Interest Payable 5,000. B. Debit Interest Payable 5,000; credit Interest Expense 5,000. C. Debit Interest Receivable 20,000; credit Interest Expense 20,000. D. No entry is necessary.

From October 1, 2019 to December 31, 2019; Interest is accrued for 3 months. Interest Expense =…

Answered: *Use the following information for…

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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*Use the following information for Multiple Choice Questions 3-4: Kinsella Seed borrowed $200,000 on October 1, 2019, at 10% interest. The interest and principal are due on October 1, 2020. What journal entry should be recorded on December 31, 2019?

A. Debit Interest Expense 5,000; credit Interest Payable 5,000.
B. Debit Interest Payable 5,000; credit Interest Expense 5,000.
C. Debit Interest Receivable 20,000; credit Interest Expense 20,000.
D. No entry is necessary.

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