161. Young Company lends Dobson industries $40,000 on August 1, 2014, accepting a 9-month, 12%...
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161. Young Company lends Dobson industries $40,000 on August 1, 2014, accepting a 9-month, 12% interest note. If Young prepares it financial statements as of December 31, 2014, what adjusting entry must it make? a. Interest Receivable 2,000 Interest Revenue 2,000 b. Accounts Receivable 2,000 Interest Receivable 2,000 c. Cash 2,000 Interest Revenue 2,000 d. Notes Receivable 2,000 Interest Revenue 2,000 The answer is A but i still do not get it why it has times 5/12 even though it said 9 month , i thought 9/12 $40,000 * .12 * 5/12 = $2,000
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