Below is the unadjusted trial balance of FOURCO.

	Debit	Credit
Cash	$18,300
Accounts receivable	27,000
Prepaid rent	5,000
Office supplies	1,200
Equipment	21,800
Accumulated depreciation		$6,000
Notes payable		8,000
Accounts payable		3,000
Unearned fees		14,000
Capital stock		18,000
Retained earnings		16,000
Fees earned		30,000
Salaries expense	14,000
Utilities expense	2,000
Insurance expense	5,800
Totals	$96,000	$96,000

FOURCO signed a note payable at the beginning of the current month. The note carries an interest rate of 6%. The note and all of the interest are due in three months. Which is the correct adjusting journal entry to record interest for the current month?

Debit Interest expense 160 and credit Interest payable 160

Debit Interest expense 480 and credit Interest payable 480

Debit Interest expense 40 and credit Interest payable 40

Debit Interest expense 120 and credit Interest payable 120

After all of the adjusting entries are posted, what will be the amount of net income that FOURCO reports on its income statement?