On November 1,Alan Company Signed a 120-Day,8% Note Payable,with a Face

Multiple Choice

On November 1,Alan Company signed a 120-day,8% note payable,with a face value of $9,000.What is the adjusting entry for the accrued interest at December 31 on the note? (Use 360 days a year.)

A) No adjusting entry is required.
B) Debit interest payable,$120; credit interest expense,$120.
C) Debit Interest Expense,$120; credit Interest Payable,$120.
D) Debit Interest Expense,$720; credit Interest Payable,$720.
E) Debit Interest Payable,$240; credit Interest Expense,$240.