Samco signed a 9-year note payable on January 1, 2025, of $540,000. The note requires annual principal payments each December 31 of $60,000 plus interest at 6%. The entry to record the annual payment on December 31, 2026, includes A. a debit to Interest Expense for $28,800. B. a credit to Cash of $92,400. C. a debit to Interest Expense for $32,400. D. a credit to Notes Payable for $60,000.
Samco signed a 9-year note payable on January 1, 2025, of $540,000. The note requires annual principal payments each December 31 of $60,000 plus interest at 6%. The entry to record the annual payment on December 31, 2026, includes A. a debit to Interest Expense for $28,800. B. a credit to Cash of $92,400. C. a debit to Interest Expense for $32,400. D. a credit to Notes Payable for $60,000.
Financial Accounting
14th Edition
ISBN:9781305088436
Author:Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:Carl Warren, Jim Reeve, Jonathan Duchac
Chapter14: Long-term Liabilities: Bonds And Notes
Section: Chapter Questions
Problem 11E
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