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On October 1, Sole Gaming Software Services purchased, from Elite Machines Co., some interactive computer screens for its gaming programmers. Payment consisted of $10,000 in
On October 1, Sole Gaming Software Services purchased, from Elite Machines Co., some interactive computer screens for its gaming programmers. Payment consisted of $10,000 in cash and an8% note payable with a face value of $100,000. The note will mature in six months on March 31 of the following year. What is the amount of interest payable that should be recorded by Sole Gaming on December 31?
A :
$4,000
B :
$8,000
C :
No interest payable should be recorded. Interest is not payable until the note matures.
D :
$2,000
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