Adair Corporation Purchased a Building on January 2 by Signing

Multiple Choice

Adair Corporation purchased a building on January 2 by signing a long-term $1,200,000 mortgage with monthly payments of $11,000.The mortgage carries an interest rate of 10 percent.The entry to record the first monthly payment will be:

A) Mortgage Interest Expense 11,000
Cash 11,000
B) Mortgage Payable 1,000
Mortgage Interest Expense 10,000
Cash 11,000
C) Mortgage Interest Expense 1,000
Mortgage Payable 10,000
Cash 11,000
D) Mortgage Payable 11,000
Cash 11,000