A $54,000,four-Month,12% Note Payable Was Issued on October 1,2018

question 137

Multiple Choice

A $54,000,four-month,12% note payable was issued on October 1,2018.Which of the following would be included in the journal entry required on the note's maturity date by the borrower? (Do not round any intermediate calculations,and round your final answer to the nearest dollar.)

• A) a credit to Note payable for $56,160
• B) a credit to Cash for $54,000
• C) a debit to Interest expense for $540
• D) a debit to Interest payable for $540

---

Definitions:

Marginal Returns

The additional output gained by employing an additional unit of a resource.

Labor

The measure of the work done by human beings in the economy, often referred to in terms of hours worked or total workforce.

Capital

Refers to the financial assets or resources that businesses use to fund their operations and grow, including cash, equipment, and buildings.

Increasing Returns

A concept in economics where an increase in the scale of production leads to a greater than proportional increase in output.