On November 1, Alan Company signed a 120-day, 10% note payable, with a face value of $20,700. What is the adjusting entry for the accrued interest at December 31 on the note? (Use 360 days a year.) Multiple Choice No adjusting entry srequired. Debit Interest Expense, $460; credit Interest Payable, $460. Debit Interest Payable, $690; credit Interest Expense, $690. Debit Interest Payable, $230; credit Interest Expense, $230. Debit Interest Expense, $345; credit Interest Payable, $345.

Principles of Accounting Volume 1
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Author:OpenStax
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Chapter9: Accounting For Receivables
Section: Chapter Questions
Problem 22MC: A company collects an honored note with a maturity date of 24 months from establishment, a 10%...
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On November 1, Alan Company signed a 120-day, 10% note payable, with a face value of $20,700. What is the adjusting entry for the accrued interest at December 31 on the note? (Use 360 days a year.)
Multiple Choice
No adjusting entry is required.
Debit Interest Expense, $460; credit Interest Payable, $460.
Debit Interest Payable, $690; credit Interest Expense, $690.
Debit Interest Payable, $230; credit Interest Expense, $230.
Debit Interest Expense, $345; credit Interest Payable, $345.
Transcribed Image Text:On November 1, Alan Company signed a 120-day, 10% note payable, with a face value of $20,700. What is the adjusting entry for the accrued interest at December 31 on the note? (Use 360 days a year.) Multiple Choice No adjusting entry is required. Debit Interest Expense, $460; credit Interest Payable, $460. Debit Interest Payable, $690; credit Interest Expense, $690. Debit Interest Payable, $230; credit Interest Expense, $230. Debit Interest Expense, $345; credit Interest Payable, $345.
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