On September 1 Bud's Painting Service Borrows $150000 from Highlands $\begin{array}{lrr} \text { Interest Payable } &3,000\\ \text { Interest Expense } &&3,000\\\end{array}$

Short Answer

On September 1 Bud's Painting Service borrows $150000 from Highlands Bank on a 4-month $150000 6% note. What entry must Bud's Painting Service make on December 31 before financial statements are prepared? a.
$\begin{array}{lrr} \text { Interest Payable } &3,000\\ \text { Interest Expense } &&3,000\\\end{array}$

b.
$\begin{array}{lrr} \text { Interest Expense } &9,000\\ \text {Interest Payable } &&9,000\\\end{array}$

c.
$\begin{array}{lrr} \text { Interest Expense } &3,000\\ \text { Interest Payable } &&3,000\\\end{array}$

d.
$\begin{array}{lrr} \text { Interest Expense } &3,000\\ \text { Notes Payable } &&3,000\\\end{array}$