Allen Inc. took out a one-year, 8%, $100,000 loan on March 31, 2021. Interest is due...
Allen Inc. took out a one-year, 8%, $100,000 loan on March 31, 2021. Interest is due upon maturity of the loan. What adjusting entry, if any, should Allen Inc. record on December 31, 2021?
Homework Answers
Interest Expenses ( From March 31 to Dec 31 = 9 Months ) :
= 100,000*8%*9/12 = 6,000
adjustment Entry on December 31, 2021
| Date | General Journal | Debit | Credit |
| Dec 31, 2021 | Interest expense | $ 6,000 | |
| Interest Payables | $ 6,000 |
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