Prepare the adjustment to accrue interest on the note payable from December 7th (24 days) the note was a three yr 8% for 11,000.

What do I debit and credit for my adjusting journal entry?

Hi,

I presume here 24 days to be calculated for accrue interest and the entry would be in the following manner...


Journal Entry Debit Credit

Accrued Interest a/c Dr 57.86

To Interest a/c 57.86


Accrued Interest a/c will go to Balance sheet as an asset and Interest a/c will go to credit side of profit & loss a/c.

I think you have it backward, the adjusting journal entry is for a note payable.
I would Dr Interest expense (an account on the P&L)
And would CR Accrued interest payable (a Bal Sheet account)

Herman

Sorry, I thought it is notes receivable.

In it cash flow statements for the current year Elliot Co. reported cash paid for interest of $70,000. Elliot did not capitalized any interest during the current year. Changes occurred in sereveal balance sheet accounts as follows>

Is it accrued interest payable $17,000 decrease and Prepaid interest $23,000 is these amount added or subtracted from the $70,000.000

The concept of verifiability is compiled with when an accounting transaction occurs