On November 1, Alan Company Signed a 120-Day, 8% Note

question 194

Multiple Choice

On November 1, Alan Company signed a 120-day, 8% note payable, with a face value of $9,000. What is the adjusting entry for the accrued interest at December 31, the company's year end, on the note?

• A)Debit interest expense, $0; credit interest payable, $0.
• B)Debit interest payable, $120; credit interest expense, $120.
• C)Debit interest expense, $120; credit interest payable, $120.
• D)Debit interest expense, $720; credit interest payable, $720.
• E)Debit interest payable, $240; credit interest expense, $240.

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Definitions:

Contingent

Dependent on or conditioned by something else; not absolute or certain.

Racial Stereotypes

Preconceived and oversimplified ideas or images about the characteristics of members of a specific race, often used to justify prejudicial attitudes and discrimination.

Criminal Justice

The system of practices and institutions of governments directed at upholding social control, deterring and mitigating crime, and sanctioning violators with criminal penalties and rehabilitation efforts.

Punitiveness

The disposition or tendency toward imposing or endorsing punishment or harsh penalties.