Ontario Resources, a natural energy supplier, borrowed $80 million cash on November 1, 2020, to fund a

geological survey. The loan was made by Quebec Banque under a short-term financing arrangement. Ontario

Resources issued a 9-month, 12% promissory note with interest payable at maturity. Ontario Resources' fiscal

period is the calendar year.

The journal entry, if needed to record any interest expense on 12/31/2020 would be:

.

A) Debit Credit

Interest expense	$ 9,600,000
Interest payable		$9,600,000

B)

Interest expense	9,600,000
Cash		9,600,000

C)

Interest expense	1,600,000
Award income		1,600,000

D) None of the above (No Journal entry)