Question 16

1. Which of the following procedures describe the entry to adjust the accounts for interest accrued at the end of the accounting period for a note payable?

a.

debit Interest Receivable; credit Interest Revenue

b.

debit Interest Expense; credit Interest Payable

c.

debit Interest Payable; credit Interest Receivable

d.

debit Interest Expense; credit Note Payable

Question 17

1. What are the factors involved in computing interest on a note?

a.

term, interest rate, and principal

b.

note payable, interest expense, and interest rate

c.

interest rate and principal

d.

interest receivable, interest rate, and term