The journal entry required on the company's books to record the note payable on July 1,20A would include which of the following?
A)A credit to notes payable for $12,000.
B)A credit to notes payable for $12,960.
C)A debit to cash for $11,040.
D)A debit to interest expense for $960.

Question

Quizplus · Accepted Answer

The note payable is recorded at its face value, which is $12,000, hence a credit to notes payable for $12,000 is required.

The Journal Entry Required on the Company's Books to Record