Moss County Bank agrees to lend the Sadowski Brick Company $500000 on January 1.Sadowski Brick Company signs a $500000 6% 9-month note.Recording the proceeds and issuance of the note by Sadowski Brick Company on January 1 includes a(n)
A) Increase to Interest Expense for $22500 increase to Cash for $477500 and an increase to Notes Payable for $500000.
B) Increase to Cash and to Notes Payable for $500000.
C) Increase to Cash for $500000 increase to Interest Expense for $22500 and an increase to Notes Payable for $522500.
D) Increase to Cash for $500000 increase to Interest Expense for $22500 increase to Notes Payable for $500000 and an increase to Interest Payable for $22500.
Correct Answer:
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