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12 November, 20:06

On November 1, Sanddel Corporation accepted a 3 month note receivable for services provided. The terms of the note were $8,000 face value with 6% interest. Sanddel Corporation closes its books on December 31. What is the entry for accrued interest on December 31?

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  1. 12 November, 20:22
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    The adjusting entry is recorded below:

    On December 31

    Interest Expense A/c Dr $40

    To Accrued Interest A/c $40

    (Being accrued interest is recorded)

    The computation of the accrued interest is shown below:

    = Note receivable * interest rate * number of months : total number of months in a year

    = $8,000 * 6% * 1 months : 12 months

    = $40
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Home » Business » On November 1, Sanddel Corporation accepted a 3 month note receivable for services provided. The terms of the note were $8,000 face value with 6% interest. Sanddel Corporation closes its books on December 31.
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