A Company Lends a Major Client $90,000 for One Year

Multiple Choice

A company lends a major client $90,000 for one year at a 7% annual interest rate.Interest payments are to be made twice a year,and interest is accrued monthly.In July,the company receives an interest payment for January through June.The company would record receipt of the interest payment in which of the following ways?

A) Debit Interest Receivable for $3,150 and credit Interest Revenue for $3,150.
B) Debit Cash for $3,150 and credit Notes Receivable for $3,150.
C) Debit Interest Revenue for $3,150 and credit Cash for $3,150.
D) Debit Cash for $3,150 and credit Interest Receivable for $3,150.