Use This Information to Answer the Following Question

question 26

Multiple Choice

Use this information to answer the following question. The transactions below pertain to Bolivar Company,whose fiscal year ends September 30.
The September 30 adjusting entry,rounded to the nearest dollar,to accrue the interest expense on the note payable is:

• A) Interest Expense 329 Cash 329
• B) Cash 329 Interest Expense 329
• C) Interest Expense 329 Interest Payable 329
• D) Interest Expense 329 Notes Payable 329

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Definitions:

Lessor

The owner of an asset that is leased to another party, referred to as the lessee.

Depreciated Historical Cost

The original cost of an asset minus accumulated depreciation, representing its value over time for accounting purposes.

Residual Value Guarantee

A promise that at the end of a lease, the asset being leased will have a certain value, often used in finance and leasing agreements.

Minimum Lease Payments

The total of all lease payments that the lessee is required to make over the lease term, excluding executory costs.