Adjusting entries 1 3 points ABC Ltd loaned (lent) XYZ Ltd $1,250,000 on Jan 1, 2010. The loan plus interest of 10% is payable on Jan 1, 2011. If both firms prepare their financial statements on Jun 30, 2010, then the combined number of adjusting (journal) entries that will be passed by these two compaies on account of this transaction on Jun 30, 2010 will be: * 5 2 3 None 3 points ABC Ltd loaned (lent) XYZ Ltd $1,250,000 on Jan 1, 2010. The loan plus interest of 10% is payable on Jan 1, 2011. If both firms prepare their financial statements on a quarterly basis then the firm ABC Ltd will record the following journal entry for date 01 Jan 2011: O Debit Cash 1375000 Credit Notes Receivable 1250000 and Credit Interest Revenue 125000 Credit Cash 1375000 Debit Notes Receivable 1250000 and Debit Accrued Interest Receivable 125000 Debit Cash 1375000 Credit Notes Receivable 1250000 and Credit Accrued Interest Receivable 125000 O Credit Cash 1375000 Debit Notes Receivable 1250000 and Debit Accrued Interest Payable 125000 Credit Cash 1375000 Debit Notes Payable 1250000 and Debit Accrued Interest Payable 125000 None