On January 1, 2013, Merrill Company Borrowed $100,000 on a 10-Year

On January 1, 2013, Merrill Company borrowed $100,000 on a 10-year, 7% installment note payable. The terms of the note require Merrill to pay 10 equal payments of $14,238 each December 31 for 10 years. The required general journal entry to record the first payment on the note on December 31, 2013 is:

A) $\begin{array}{|l|r|r|}\hline \text { Notes Payable } & 7,238 & \\\hline \text { Interest expense } & 7,000 & \\\hline \text { Cash } & & 14,238 \\\hline\end{array}$
B) $\begin{array}{|l|r|r|}\hline \text { Notes Payable } & 7,000 & \\\hline \text { Interest expense } & 7,238 & \\\hline \text { Cash } & & 14,238 \\\hline\end{array}$
C) $\begin{array}{|l|r|r|}\hline \text { Notes Payable } & 10,000 & \\\hline \text { Interest expense } & 7,000 & \\\hline \text { Cash } & & 17,000 \\\hline\end{array}$
D) $\begin{array}{|l|r|r|}\hline \text { Notes Payable } & 14,238 & \\\hline \text { Cash } & & 14,238 \\\hline\end{array}$
E) $\begin{array}{|l|r|r|}\hline \text { Notes Payable } & 10,000 & \\\hline \text { Interest expense } & 4,238 & \\\hline \text { Cash } & & 14,238 \\\hline\end{array}$