Answer:
C) $4,500.
Step-by-step explanation:
The interest expense for one year is $6,000 (100,000 * 6%). The Accrual Principle of Accounting requires entities to record expenses in a period in which they are incurred and not when paid. So, we have to record the interest accrued for nine months that is from April to December.
⇒ Interest Expense at Year End = (6,000 / 12) * 9 = $4,500.