When a business records accrued interest expense on a note payable, ________.

A.

Interest Payable is debited

B.

Cash is credited

C.

Notes Payable is credited

D.

Interest Expense is debited

On November 1, 2025, Ashton, Inc. purchased merchandise inventory for $35,000 by signing a note payable. The note is for 6 months and bears interest at a rate of 8%. The journal entry for the purchase of the merchandise using a perpetual inventory system would be:

A.

Merchandise Inventory	35,000
Notes Payable		35,000

B.

Notes Payable	35,000
Merchandise Inventory		35,000

C.

Merchandise Inventory	35,000
Accounts Payable		35,000

D.

Accounts Payable	35,000
Merchandise Inventory		35,000