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How to enter interest paid in journal entry
Tyring to journal interest paid on bonds issued. I think I debit the bond interest paid, but then do I credit cash? For example, on 12/31, I have debit of Bond Interest Expense and a credit of Bond Interest Payable. If the interest is paid on 1/1, how do I journal the entry? I am thinking a Bond Interest Payable debit and then a Cash credit for an equal amount? Or should it be the original amount of the bonds + the amount of interest paid?
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