the company has a bank loan and has incurred (but not recorded) interest expense of $4,000 for the year…
the company has a bank loan and has incurred (but not recorded) interest expense of $4,000 for the year ended december 31. the company will pay the interest five days after the year - end on january 5. note: enter debits before credits. transaction general journal debit credit f. record entry clear view general journal
Answer
Explanation:
Step1: Identify the accounts involved
The company has incurred interest expense and has a liability for the unpaid interest. Interest Expense is debited as it is an expense, and Interest Payable is credited as it is a liability.
Step2: Record the journal entry
Debit Interest Expense for $4,000 and credit Interest Payable for $4,000.
| Transaction | General Journal | Debit | Credit |
|---|---|---|---|
| f. | Interest Expense | $4,000 | |
| Interest Payable | $4,000 |
Answer:
| Transaction | General Journal | Debit | Credit |
|---|---|---|---|
| f. | Interest Expense | $4,000 | |
| Interest Payable | $4,000 |