Taylor Bank lends Guarantee Company $118,987 on January 1. Guarantee Company signs a $118,987, 7%, 9-month, interest-bearing note. The entry made by Guarantee Company on January 1 to record the proceeds and issuance of the note is

a.

Interest Expense		6,247
Cash		112,740
Notes Payable			118,987

b.

Notes Payable		118,987
Interest Payable		3,124
Cash			118,987
Interest Expense			3,124

c.

Cash		125,234
Interest Expense			6,247
Notes Payable			118,987

d.

Cash		118,987
Notes Payable			118,987