Use the following to answer questions 6-7: On September 1", Ken's Painting Service borrows $50,000 from National Bank on a 4-month, $50,000, 6% note. 6. What entry must Ken's Painting Service make on December 31st before financial statements are prepared? a. Interest Payable........... ................ 1,000 Interest Expense.................***** 1,000 b. Interest Expense.... 3,000 Interest Payable............ 3,000 c. Interest Expense..... 1,000 Interest Payable........ 1,000 d. Interest Expense......... 1,000 Notes Payable......... 1,000 OOO Pg. 3 7. The entry by Ken's Painting Service to record payment of the note and accrued interest on January 1" is a. Notes Payable............ 51,000 Cash........... 51,000 b. Notes Payable..... 50,000 Interest Payable............. 1,000 Cash........... 51,000 c. Notes Payable..... 50,000 Interest Payable............. 3,000 Cash............. 53,000 d. Notes Payable............... 50,000 Interest Expense............. 1,000 Cash............... 51,000 A) a B) b C) D) d 8. The present value of a $10,000, 5-year bond, will be less than $10,000 if the A) contractual interest rate is less than the market interest rate. B) contractual interest rate is greater than the market interest rate. C) bond is convertible. D) contractual interest rate is equal to the market interest rate. Use the following to answer questions 9-10: Golden Company received proceeds of $94,250 on 10-year, 8% bond issued on January 18, June 30th and