Question

West County Bank agrees to lend the Block Builders Company $100,000 on January 1. Block Builders Company signs a $100,000, 6%, 6-month note.

What is the adjusting entry required if Block Builders Company prepares financial statements on March 30?

a. Interest Expense 3,000
Interest Payable 3,000
b. Interest Expense 3,000
Cash 3,000
c. Interest Expense 1,500
Interest Payable 1,500
d. Interest Payable 1,500
Interest Expense 1,500

Answer 1

the right answer is A

Step-by-step explanation:

Answer 2

The correct answer is A.

Step-by-step explanation:

Giving the following information:

West County Bank agrees to lend the Block Builders Company $100,000 on January 1. Block Builders Company signs a $100,000, 6%, 6-month note.

Monthly interest= 100,000*0.01= $1,000

Adjusting entry:

Interest expense 3,000

Interest payable 3,000