Bill's Bikes Discounts a Customer's 90-Day,8%,$4,000 Note at a Bank

Multiple Choice

Bill's Bikes discounts a customer's 90-day,8%,$4,000 note at a bank at 12%.The discount period is 50 days.It records the proceeds as:

A) debit Cash $4,012;credit Notes Receivable $4,000;credit Interest Income $12.
B) debit Cash $4,160;credit Notes Receivable $4,080;credit Interest Income $80.
C) debit Cash $4,068,credit Notes Receivable $4,000;credit Interest Income $68.
D) debit Cash $4,012;credit Notes Receivable $4,000,credit Interest Expense $12.