At the end of the accounting period,a company has accrued interest revenue that will not be received until the next accounting period.The adjusting entry would include a:

Question

Quizplus · Accepted Answer

The adjusting entry would include a debit to Interest Receivable, since the company has earned interest revenue but has not yet received the cash. This will increase the asset account of Interest Receivable, and the revenue will be recognized in the current accounting period. Option A is incorrect because it would decrease the company's interest expense, which is not the correct account to adjust. Option B is incorrect because it would increase the company's interest payable, which is not accurate since the company is not obligated to pay interest. Option C is incorrect because debiting Interest Revenue would overstate the revenue in the current accounting period since the company has not yet received the cash.

At the End of the Accounting Period,a Company Has Accrued