Vast Company Signed a 180-Day Note, Dated March 1, for $4,500

question 26

Multiple Choice

Vast Company signed a 180-day note, dated March 1, for $4,500 that Rationale Bank discounted at 10 percent. Which of the following journal entries records the payment of the note to the bank at maturity for Vast Company?

• A) Debit Notes Payable by $4,275; credit Cash by $4,275
• B) Debit Notes Payable by $4,500; credit Cash by $4,500
• C) Debit Interest Expense by $225; credit Cash by $225
• D) Debit Notes Payable by $4,275, Interest Expense by $225; credit Cash by $4,500

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