The amount of interest due on notes and bonds payable owed by the company is adjusted on the work sheet by debiting Interest Expense and crediting Accrued Interest Payable.

Question

Quizplus · Accepted Answer

This statement is true. Accrued interest payable is a liability account that represents the amount of interest owed but not yet paid, while interest expense is an income statement account that represents the cost of borrowing money. The adjustment to record the accrued interest payable is done by debiting interest expense and crediting accrued interest payable.

The Amount of Interest Due on Notes and Bonds Payable