How much interest was paid in Jan? I am getting confused with the journal entries and the T account entries. Any help is greatly appreciated. Thanks
01/01 Balance - Interest payable $ 1,200
01/31 Balance - Interest payable $ 2,600
Interest expense for the period $12,500

The interest owed at 1/1/01 was paid = 1,200

Interest expense per G/ledger = 12,500 and
this should include the accrual
of 2,600 which was not paid (2,600) which means the cash payments in the expense acct = 9,900

Adding the 9,900 to the 1,200 gives cash paid of 11,100