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On February 2, xox1 ABC Company lent money to DEF Enterprises for the amount of $10,000. The interest was 6% annual rate. (4 points) 13.

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On February 2, xox1 ABC Company lent money to DEF Enterprises for the amount of $10,000. The interest was 6% annual rate. (4 points) 13. Once ABC Company processed the loan of money, how this event will affect the accounting equation (Financial Statements-horizontal)? a) Increase Cash and increase Notes Receivable by $10,000 The cash flow will be affected by $10,000 inflow. b) Decrease Cash and increase Notes Receivable by $10,000. The cash flow will be affected by $10,000 outflow. c) Decrease Cash and decrease Notes Receivable by $10,000. The cash flow will be affected by $10,000 outflow. (4 points) 14. If ABC Company decided to register the interest adjusting entry at the end of the accounting period on December 31, xxxl; how this event will affect the accounting equation (Financial Statements-horizontal)? a) Increase Interest Receivable and increase Retained Earnings by $550. Increase Interest Revenue and increase Net Income by $550. b) Increase Interest Receivable and decrease Retained Earnings by $550. Decrease Interest Expense and decrease Net Income by $550. c) Increase Interest Receivable and increase Retained Earnings by $600. Increase Interest Revenue and increase Net Income by $600. (4 points) 15. Also, ABC Company wanted to register the interest accrual at the end of the accounting period on December 31, xox1; how this event will affect the accounting equation (Financial Statements-horizontal)? a) Increase Interest Receivable and increase Retained Earnings by $50. Increase Interest Revenue and increase Net Income by $50. b) Increase Interest Receivable and increase Retained Earnings by $60. Increase Interest Revenue and increase Net Income by $60. c) Increase Interest Receivable and increase Retained Earnings by $50. Decrease Interest Revenue and decrease Net Income by $50. (4 points) 16. On the maturity date, ABC Company collected the principal and the interest associated with the credit agreement. How this event will affect the accounting equation (Financial Statements-horizontal)? a) Increase Cash by $10,060, decrease Interest Receivable by $60, and decrease Notes Receivable by $10,000. The cash flow will be affected by $10,060 inflow. b) Increase Cash by $10,550, decrease Interest Receivable by $550 and decrease Notes Receivable by $10,000. The cash flow will be affected by $10,550 inflow. c) Increase Cash by $10,600, decrease Interest Receivable by $600, and decrease Notes Receivable by $10,000. The cash flow will be affected by $10,600 inflow

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