Flipco signed a 10-year note payable on January 1, 2024, of $800,000. The note requires annual principal
Question:
Flipco signed a 10-year note payable on January 1, 2024, of $800,000. The note requires annual principal payments each December 31 of $80,000 plus interest at 5%.
The entry to record the annual payment on December 31, 2025, includes
a. a debit to Interest Expense for $36,000.
b. a debit to Interest Expense for $40,000.
c. a credit to Notes Payable for $80,000.
d. a credit to Cash of $120,000.
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ISBN: 9781292412337
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Authors: Tracie Miller Nobles, Brenda Mattison, Ella Mae Matsumura
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