1. On November 1, Alan Company signed a 120-day, 8% note payable, with a face value of $9,000. What is the adjusting entry for the accrued interest at December 31 on the note? (Use 360 days a year.)

   		A) No adjusting entry is required.
   		B) Debit interest payable, $120; credit interest expense, $120.
   		C) Debit Interest Expense, $120; credit Interest Payable, $120.
   		D) Debit Interest Expense, $720; credit Interest Payable, $720.
   		E) Debit Interest Payable, $240; credit Interest Expense, $240.