On January 1, 2016, Tessa loaned $12,000 to another company on a three-year, 4% note. No interest was accrued in 2016. Cash will not be received for the interest until the end of the threeyear period. The error was discovered before adjusting and closing entries were posted on December 31, 2017. Ignoring income taxes, what should be the correct journal entry on December 31

a. Interest Receivable 480

Retained Earnings 480

b. Interest Receivable

960 Interest Revenue 960

c. Interest Receivable 480

Interest Revenue 480

d. Interest Receivable 960

Interest Revenue 480

Retained Earnings 480