The following unadjusted trial balance was taken from the books of GMC Firm at the end of its fiscal year on December 31, 2022. GMC Firm offers accounting professional services to clients.

At the year-end, the following adjusting items have either not yet recorded or improperly recorded: a. Insurance expired during the year $3,000. b. Bad debts expense for the year $1,000. c. Depreciation on equipment is 10% on cost d. The 3% APR note payable has a 90-day (3 months) maturity. It was signed on November 1, 2022. e. Rent paid in advance at December 31, 2022, $5,000 (originally charged to rent expense). f. Accrued salaries and wages on December 31, 2022 amounted to $4,000. g. Of unearned service revenue, $6,000 was earned on December 31, 2022. h. Services for $8,000 were provided but clients were not yet billed (invoiced) by December 31, 2022. i. Amount of $4,500 was received from clients in advance and included as service revenue. However, by December 31, 2022, services were not yet performed to clients. j. An inventory count on December 31, 2022 revealed that $22,000 worth of supplies had been used up.

What is the correct adjusting journal entry for d above?

a. Debit interest expense $100; and credit interest payable $100

b. Debit interest expense $75; and credit interest payable $75

c. Debit interest expense $40; and credit interest payable $40

d. Debit interest expense $150; and credit interest payable $150

\begin{tabular}{|l|l|l|} \hline Account & Debit (\$) & Credit (\$) \\ \hline Cash & 31,000 & \\ \hline Accounts Receivable & 50,000 & \\ \hline Allowance for Doubtful & & 2,000 \\ Accounts & & \\ \hline Notes Payable & & 30,000 \\ \hline Supplies & 32,000 & \\ \hline Prepaid Insurance & 25,000 & \\ \hline Equipment, Cost & 200,000 & \\ \hline Accumulated Depreciation - & & 40,000 \\ Equipment & & \\ \hline Income Taxes Payable & & 10,800 \\ \hline Owner's Capital & & 45,360 \\ \hline Retained Earnings 1/1/2022 & & 35,000 \\ \hline Service Revenue & & 270,000 \\ \hline Unearned Service Revenue & & 10,000 \\ \hline Utilities Expense & 34,160 & \\ \hline Salaries and Wages Expense & 56,000 & \\ \hline Rent Expense & 15,000 & \\ \hline Total & 43,160 & 443,160 \\ \hline \end{tabular}