Barton Company has a line of credit with Sea View Bank. Barton can borrow up to $200,000 at any time over the course of Year 2. The following table shows the interest rate expressed as an annual percentage along with the amounts borrowed and repaid during the first three months of Year 2. Funds are borrowed or repaid on the first day of each month. Interest is payable in cash on the last day of the month. The interest rate is applied to the outstanding monthly balance. Month January February March Amount Borrowed/ (Repaid) $25,000 (5,000) 20,000 Annual Interest Rate 6% 9% 9% Which of the following shows how the $5,000 payment on the line of credit liability would affect Barton's financial statements? Income Statement Balance Sheet Liab. + Assets = Rev. = Net Inc. Equity NA Exp. NA A. = + NA NA B. Statement of Cash Flows 5,000 FA (5,000) FA (5,000) FA (5,000) FA = 5,000 |(5,000)] + NA NA NA 5,000 (5,000) (5,000) (5,000) 5,000 (5,000) C. = + (5,000) NA NA NA D. (5,000)| + NA NA NA NA Multiple Choice Option A Option B X Option C Option D