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Solo Company Borrowed $4,000 from National City Bank on June  Cash 4,000 Interest Expense 100 Notes Payable 4,100\begin{array}{lr}\text { Cash } & 4,000 \\\text { Interest Expense } & 100\\\text { Notes Payable }&4,100\end{array}

Question 68

Multiple Choice

Solo Company borrowed $4,000 from National City Bank on June 1. On August 31, Solo Company paid off the loan plus $100 interest. The correct entry to record the August 31 payment of the loan plus interest is


A)
 Cash 4,000 Interest Expense 100 Notes Payable 4,100\begin{array}{lr}\text { Cash } & 4,000 \\\text { Interest Expense } & 100\\\text { Notes Payable }&4,100\end{array}
B)
 Notes Payable 4,000 Interest Expense 100 Cash 3,900\begin{array} { l c } \text { Notes Payable } & 4,000 \\\text { Interest Expense } & 100 \\\text { Cash } & 3,900\end{array}
C)
 Cash 4,000 Notes Payable 100 Interest Expense 4,100\begin{array} { l r l } \text { Cash } & 4,000 & \\\text { Notes Payable } & 100 & \\\text { Interest Expense } & & 4,100\end{array}
D)
 Notes Payable 4,000 Interest Expense 100 Cash 4,100\begin{array} { c c } \text { Notes Payable } & 4,000 \\\text { Interest Expense } & 100 \\\text { Cash } & 4,100\end{array}

Correct Answer:

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