Started business on jan1st list below are some events that, Ask an Expert

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Started business on Jan.1st. List below are some events that occurred its first year operation.

1. Equipment worth $150,000 was purchased on Sep. 1st, in exchange for $50,000 in cash and two- year, 10% note with a principal amount of $100,000.

2. There was no interest paid on the note during the year.

The question is:

What is the interest expense(which is on the debit side) for this year.

And what is the interest payable (which is on the credit side) for this year.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9796868

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