Question

The adjusting journal entry for accrued interest is?

Group of answer choices

debit asset, credit liability

debit expense, credit liability

debit liability, credit stockholders' equity

debit liability, credit expense

debit expense, credit revenue

Answer 1

The adjusting journal entry for accrued interest is?

Answer: debit expense, credit liability

Only the correct answer is the above,

It based on borrower book, there is no adjusting entry for lender’s book.

Under the accrual basis of accounting, the amount of accrued interest, which means interest due but not paid is to be recorded with accrual adjusting entries by the borrower before issuing their financial statements. .

The borrower's adjusting entry will be like

Debit Interest Expense

Credit Accrued Interest Payable

Here Debit is the expenses account and credit is the current liability account, which shown on the assets side of balance sheet

So, the answer debit expenses, credit liability is the correct answer.

All other answers are in correct.