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Cash = Debit 50440 Prepared Interest Debit 1560 Notes payable Credit 5200 Record the adjusted for interest on the payable Solution interest is an expense and hence it would be debited interest payable is a liability and hence it would be credited therefore entry would be Interest expense Dr. 1560 Interest Payable Cr. 1560 (to record interest payable).

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Cash = Debit 50440 Prepared Interest Debit 1560 Notes payable Credit 5200 Record the adjusted for interest on the payable Solution interest is an expense and hence it would be debited interest payable is a liability and hence it would be credited therefore entry would be Interest expense Dr. 1560 Interest Payable Cr. 1560 (to record interest payable)

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