Question $9$

$1pts$

On December $31,2020,$ XYZ Ltd$.,$ a calendar year company, accrued interest on a non$-$interest$-$bearing Note Payable. What were the financial statement effects of this entry?

Interest expense increased, and liabilities increased.

Interest payable increased and equity decreased.

Interest expense decreased, and assets decreased.

Discount on notes payable increased and liabilities increased.