Assume that the $2,000,90-day,8 percent note was received on August 31 and that the fiscal year ended on September 30.The adjusting entry that would be made to record the interest receivable is (amounts rounded to nearest dollar):

Question

Quizplus · Accepted Answer

The correct adjusting entry to record the interest receivable for a $2,000 note at 8 percent for 90 days, considering only one month (30 days) falls within the fiscal year ending September 30, is to debit Interest Receivable and credit Interest Income. The interest for 30 days is calculated as $2,000 * 8% * (30/360) = $13.33, rounded to the nearest dollar is $13.

Assume That the $2,000,90-Day,8 Percent Note Was Received on August