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At December 31, the unadjusted trial balance of H&R Tacks reports Interest Payable of $0 and...

At December 31, the unadjusted trial balance of H&R Tacks reports Interest Payable of $0 and Interest Expense of $0. Interest incurred and owed in December totals $420. Required:

a. Prepare the adjusting journal entry on December 31. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

b.

Prepare the T-accounts for each account, enter the unadjusted balances, post the adjusting journal entry, and report the adjusted balance.
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Answer #1

Adjusting Journal Entry

Date General Journal Debit Credit
Dec 31

Interest expense a/c

To Interest payable a/c

(Being Interest expense recognised)

$420

 $420

T- Accounts:

Interest expense a/c
Date Particulars Debit Date Particulars Credit
Dec 31 To Interest payable a/c $420
Dec 31 Closing balance $420
$420 $420
Interest payable a/c
Date Particulars Debit Date Particulars Credit
Dec 31 Interest expense a/c $420
Dec 31 Closing balance $420
$420 $420
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