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A company issues a $25,000 three-year note. The stated rate and effective rate were both 2%. Which journal entry should be used to record the
A company issues a $25,000 three-year note. The stated rate and effective rate were both 2%. Which journal entry should be used to record the issuance of the ling term note payable?
- Debit Notes payable for $23,500; Credit Cash for $23,500
- Debit Notes payable for $25,000; Credit Cash for $25,000
- Debit Cash for $25,000; Credit Notes Payable $25,000
- Debit Cash for $23,500; Credit Notes Payable $23,500
A Company issues a $25,000 three-year note on the first day of the year. The stated and effective rates are both 2%. Which journal entry should be used to record interest expense at the end of Year 1?
- Debit interest Receivable for $500; Credit Cash for $500
- Debit Cash for $500; Credit interest Receivable for $500
- Debit interest Expense for $500; Credit Cash for $500
- Debit Cash for $500; Credit interest expense for $500
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