Why is an adjustment necessary for interest accrued on a note payable at the end of the period if the interest will not be paid until the note is due? $($Checl

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The adjustment is needed to accurately portray the interest liability of the company, all amounts owed should be reported on the balance shee

Interest Revenue should be increased to reflect the amount of the interest earned during the current period.

The accrued interest needs to be credited to the Note Payable account to accurately report the total amount due on the note.

Even though the interest will not be paid until a future period, the expense was actually incurred during the current accounting period.