Baden Industries Borrows $20,000 at 7% Annual Interest for Six

Multiple Choice

Baden Industries borrows $20,000 at 7% annual interest for six months on October 1, 2022.Which is the appropriate entry to accrue interest if Baden employs a December 31, 2022, fiscal year?

A) Dr Interest Expense $350 Cr Interest Payable $350
B) Dr Interest Expense $1,400 Cr Interest Payable $1,400
C) Dr Interest Expense $350 Cr Notes Payable $350
D) Dr Notes Payable $1,400 Cr Interest Payable $1,400