Young Company lends Dobson Industries $30,000 on August 1, 201X, accepting a 9-m

Question

Young Company lends Dobson Industries $30,000 on August 1, 201X, accepting a 9-month, 12% interest note. If Young prepares it financial statement as of December 31, 201X, what adjusting entry must it make?

Question 1 options:

Interest Receivable................1,500

............Interest Revenue......................1,500

Cash..................................1,500

............Interest Revenue.......................1,500

Accounts Receivable..............1,500

.............Interest Receivable....................1,500

Notes Receivable..................1,500

.............Interest Revenue.......................1,50

Interest Receivable................1,500

............Interest Revenue......................1,500

Cash..................................1,500

............Interest Revenue.......................1,500

Accounts Receivable..............1,500

.............Interest Receivable....................1,500

Notes Receivable..................1,500

.............Interest Revenue.......................1,50

Explanation / Answer

Interest Receivable................1,500

............Interest Revenue......................1,500

30000*12%/12MONTHS*5 MONTHS =1500 INTEREST

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