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A business borrowed $51,873 on March 1 of the current year by signing a 30 day, 6% interest bearing note. Assuming a 360-day year, when the note is paid on March 31, the entry to record the payment should include a

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Tundexi

Answer:

Debit to interest expenses for $259

Explanation:

Entry of Payment

Date       Account Title and Explanation     Debit        Credit

Mar 31.    Note Payable                                 $51,873

               Interest expenses                          $259

               ($51,873 * 6% * 30/360)

                       Cash                                                        $52,132

               (TO record payment)

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