On December 1, 2017, Physical Bank Made a Loan to a Customer

question 17

Multiple Choice

On December 1, 2017, Physical Bank made a loan to a customer of $2,000,0000, with an annual interest rate of 6%. The loan, and all the interest, are due on November 30, 2018. The appropriate adjusting entry the bank should make on December 31, 2017 is

• A) Debit cash $10,000 and credit interest revenue $10,000
• B) Debit interest revenue $10,000 and credit cash $10,000
• C) Debit interest receivable $10,000 and credit interest revenue $10,000
• D) Debit interest revenue $10,000 and credit interest receivable $10,000

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Definitions:

State Court System

The judicial system at the state level in the United States, consisting of courts with varying scopes of authority, from local tribunals to state supreme courts.

Attach Bill's Automobile

The legal process of seizing Bill's car as security or satisfaction of a judgment or debt.

Valid Judgment

A court's final decision that is legally binding and enforceable, having met all necessary legal requirements.

Diversity of Citizenship

Diversity of Citizenship is a legal concept in the United States that allows federal courts to hear cases where parties are from different states or countries.