What is the adjusting entry for the accrued interest at dec

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Problem 1: On November 1, Alan Company signed a 120-day, 9% note payable, with a face value of $25,200. What is the adjusting entry for the accrued interest at December 31 on the note? (Use 360 days a year.)

Multiple Choice

Option 1:
Debit Interest Payable, $756; credit Interest Expense, $756.

Option 2:
Debit Interest Payable, $252; credit Interest Expense, $252.

Option 3:
No adjusting entry is required.

Option 4:
Debit Interest Expense, $504; credit Interest Payable, $504.

Option 5:
Debit Interest Expense, $378; credit Interest Payable, $378.

Reference no: EM132930672

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