on-december-31-2022-abc-company-accrues-interest-payable-of-4500-for-its-bonds-w

Question

On December 31, 2022, ABC Company accrues interest payable of $4,500 for its bonds. What is the journal entry on December 31, and what is the entry on January 1, 2023, when the interest is paid?

Accepted Answer

December 31: Debit Interest Expense $$4,500, Credit Interest Payable 4$$,500; January 1: Debit Interest Payable $$4,500, Credit Cash 4$$,500.

Answer

December 31: Debit Interest Expense $$4,500, Credit Cash 4$$,500; January 1: Debit Interest Payable $$4,500, Credit Interest Expense 4$$,500.

Answer

December 31: Debit Interest Payable $$4,500, Credit Interest Expense 4$$,500; January 1: Debit Cash $$4,500, Credit Interest Payable 4$$,500.

Answer

December 31: Debit Cash $$4,500, Credit Interest Expense 4$$,500; January 1: Debit Interest Expense $$4,500, Credit Interest Payable 4$$,500.

On December 31, 2022, ABC Company accrues interest payable of \$4,500 for its bonds. What is the journal entry on December 31, and what is the entry on January 1, 2023, when the interest is paid?