Exercise 9-2A (Algo) Effects of recognizing accrued interest on financial statements LO 9-1 Bifl Dacby started Darby Company on Januasy 1, Year 1, The company experienced the following events dsuring ns first year of: operation: 1. Earned 51,900 of cash revenue. 2. Boriowed $2,700 cash from the bank 3. Adjusted the accounting records to recognize accrued interest expense on the bank note The note, issued on September 1, Year 1 . had a one-year term and an 6 percent snnual interest rate. Aequired a. What is the amount of interest payable at December 3t, Year 1 ? b. What is the amount of interest expense in Year 1 ? c. What is the amount of interest paid in Year 1 ? d. Use a horizontai statements model to show how each event affects the balance sheet, income statement, and statement of cash flows. Indicate whether the event incresses (0) or decreases (D) each eiement of the financial statements. in the Statement of Cash Flows column, classify the cash flows as operating activities (OA) investing activities (A) or tinancing activties (FA) Cotumns for events that have na effect on any of the elements should be left blank, The first transaction has been recorded as an example Cemplete this question by entering your answers in the tabs below. What is the emount of interrst payable at December 31 , Vear 17 Note: Do not round intermediate caladations. Rlound you answer to the nearest dollar amount. What is the amounk of interest expense in Year 1 ? Note: Do nut tound intermediate calculations, Round your answer to the neaneit dollar amouits. What is the amount of imterest poid in Vesr 1