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On October 31, 2017, Pink Inc

Question 56

Multiple Choice

On October 31, 2017, Pink Inc.lent $42,000 to Zinc Inc.in return for a three-month, 3.5% interest-bearing note.What adjusting entry should Pink Inc.make on December 31, 2017, in connection with this note?


A) Debit Interest Receivable and credit Interest Revenue, $367.50.
B) Debit Cash and credit Interest Revenue, $245.
C) Debit Interest Receivable and credit Interest Revenue, $245.
D) Debit Interest Revenue and credit Interest Receivable, $122.50.

Correct Answer:

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