On October 1, you borrow $206,000 in order to build a new facility. The loan is for 10 years, at 6% interest, and semiannual interest payments are due each April and October. The journal entry to record the issuance of the promissory note should:

debit Cash for $206,000, debit Interest Expense for $12,360, credit Notes Payable for $206,000, and credit Interest Payable $12,360.

debit Cash for $206,000 and credit Notes Payable for $206,000.

debit Accrued Interest for $12,360 and credit Cash for $12,360.

debit Notes Payable for $206,000, debit Interest Expense for $12,360, credit Cash for $206,000, and credit Interest Payable for $12,360.