On September 1,Kennedy Company Loaned $100,000,at 12% Annual Interest,to a Customer.Interest

Multiple Choice

On September 1,Kennedy Company loaned $100,000,at 12% annual interest,to a customer.Interest and principal will be collected when the loan matures one year from the issue date.Assuming adjustments are only made at year-end,what is the adjusting entry for accruing interest that Kennedy would need to make on December 31,the calendar year-end?

A) Debit Interest Expense,$12,000; credit Interest Payable,$12,000.
B) Debit Interest Expense,$4,000; credit Interest Payable,$4,000.
C) Debit Interest Receivable,$12,000; credit Cash,$12,000.
D) Debit Interest Receivable,$4,000; credit Interest Revenue,$4,000.
E) Debit Cash,$4,000; credit Interest Revenue,$4,000.