On October 1, Lawrence Company Borrowed $60,000 from Fourth National

question 147

Multiple Choice

On October 1, Lawrence Company borrowed $60,000 from Fourth National Bank on a 1-year, 7% note. If the company's fiscal year ends as of December 31, Lawrence should make an entry to increase

• A) interest payable, $1,050.
• B) prepaid interest, $3,150.
• C) notes payable, $1,050.
• D) interest expense, $4,200.

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