On November 1, Alan Company Signed a 120-Day, 8% Note

Multiple Choice

On November 1, Alan Company signed a 120-day, 8% note payable, with a face value of $9,000. Alan made the appropriate year-end accrual on December 31. What is the journal entry as of March 1 to record the payment of the note assuming no reversing entry was made?

A) Debit Notes Payable $9,000; debit Interest Payable $120; credit Cash $9,120.
B) Debit Cash $9,240; credit Notes Payable $9,240.
C) Debit Notes Payable $9,240; credit Interest Payable $120; credit Interest Expense $120; credit Cash $9,000.
D) Debit Notes Payable $9,000; debit Interest Payable $120; debit Interest Expense $120; credit Cash $9,240.
E) Debit Notes Payable $9,000; debit Interest Expense $240; credit Cash $9,240.