Indicate Whether Each of the Following Is True or False

Short Answer

Indicate whether each of the following is true or false. Peyton Company borrowed money from its bank in July 2013. The accrual of interest on the loan at the end of 2013
_____ a) does not affect cash flows.
_____ b) involves recognition of interest expense.
_____ c) decreases income for 2013.
_____ d) involves recognition of a liability.
_____ e) records a cash payment for interest.