Morrison Corporation Borrowed $45,000 from Commercial Bank on June 1

question 138

Multiple Choice

Morrison Corporation borrowed $45,000 from Commercial Bank on June 1 of the current year.The bank required 9% interest.Interest will be paid every three months until the 9-month note is paid.What is the total Interest Expense and the Interest Payable at December 31 of the current year?

• A)Interest Expense $2,362.50; Interest Payable $2362.50
• B)Interest Expense $337.50; Interest Payable $337.50
• C)Interest Expense $2,362.50; Interest Payable $337.50
• D)Interest Expense $3,037.50; Interest Payable $2362.50