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Question
Company A and Company B each borrow $2,000 from the bank. Company A signed a 60-day, 12% note. Company B signed a 90-day, 11% note. How will each of these companies record these events in their respective general journals on the day the money was borrowed?
A.
Company A
| Cash | 2,000 | |
| Notes Payable | 2,000 |
Company B
| Cash | 2,000 | |
| Notes Payable | 2,000 |
00 Notes Payableompany record this event in the general journal?
B.
Company A
| Cash | 2,040 | |
| Interest Expense | 40 | |
| Notes Payable | 2,000 |
Company B
| Cash | 2,055 | |
| Interest Expense | 55 | |
| Notes Payable | 2,000 |
C.
Company A
| Notes Payable | 2,000 | |
| Cash | 2,000 |
Company B
| Notes Payable | 2,000 | |
| Cash | 2,000 |
D.
Company A
| Interest Expense | 40 | |
| Notes Payable | 2,000 | |
| Cash | 2,040 |
Company B
| Interest Expense | 55 | |
| Notes Payable | 2,000 | |
| Cash | 2,055 |
E. .
Company A
| Cash | 2,040 | |
| Notes Payable | 2,040 |
Company B
| Cash | 2,055 | |
| Notes Payable | 2,055 |
Answer
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