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on november 1, 2021, new morning bakery signed a $200,000, 6%, six-month note payable with the amount borrowed plus accrued interest due six months later on may 1, 2022. new morning bakery should record which of the following adjusting entries at december 31, 2021? (do not round your intermediate calculations.) multiple choice debit interest expense and credit cash, $6,000. debit interest expense and credit cash, $2,000. debit interest expense and credit interest payable, $6,000. debit interest expense and credit interest payable, $2,000.

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tutorconsortium270

Credit Interest Payable and debit Interest Expense, totaling $2,000.

Is the cost of interest a deduction or credit?

First, interest expense is a liability account and is shown as such on the balance sheet, whereas interest payable is an expense account and is shown as such on the income statement. Second, whereas interest payable is documented with a credit in the accounting records, interest expense is recorded with a debit.

How are interest and credit costs debited?

You must pay interest when you take out a loan or credit line. The cost and accrued interest must be recorded in your books. Debit the Interest Expense account and credit the Accumulated Interest Payable account to reflect the interest that has accrued over a given accounting period. Your spending and payable accounts grow as a result.

Learn more about  interest here:

https://brainly.com/question/27584159

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