On August 1 of the Current Year,Kyle Company Borrowed $278,000

question 76

Multiple Choice

On August 1 of the current year,Kyle Company borrowed $278,000 from the local bank.The loan was for 12 months at 9 percent interest payable at the maturity date.The adjusting entry at the end of the fiscal year relating to this obligation would include a

• A) debit to interest expense of $25,020.
• B) debit to interest expense of $10,425.
• C) credit to note payable of $10,425.
• D) debit to interest receivable of $10,425.

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