Question

trent restaurant borrowed $110,000 on october 1 by signing a note payable to hometown bank. the interest expense for each month is $825. the loan agreement requires trent to pay interest on january 2 for october, november and december. read the requirements. 1. make trents adjusting entry to accrue monthly interest expense at october 31, at november 30, and at december 31. date each entry and include its explanation. (record debits first, then credits. select the explanation on the last line of the journal entry table.) make the adjusting entry to accrue monthly interest expense for october. date accounts and explanation debit credit

Explanation:

Step1: Determine accounts for October entry

Debit Interest Expense, credit Interest Payable.

Step2: Record amounts for October

Debit Interest Expense $825$, credit Interest Payable $825$ for October - accrued interest expense.

Step3: November entry logic

Same as October, debit Interest Expense and credit Interest Payable for $825$ for November - accrued interest expense.

Step4: December entry logic

Same as previous months, debit Interest Expense and credit Interest Payable for $825$ for December - accrued interest expense.

Date	Accounts and Explanation	Debit	Credit
Oct 31	Interest Payable		$825$
Nov 30	Interest Expense<br>To accrue interest expense for November	$825$
Nov 30	Interest Payable		$825$
Dec 31	Interest Expense<br>To accrue interest expense for December	$825$
Dec 31	Interest Payable		$825$

Answer:

Date	Accounts and Explanation	Debit	Credit
Oct 31	Interest Payable		$825$
Nov 30	Interest Expense<br>To accrue interest expense for November	$825$
Nov 30	Interest Payable		$825$
Dec 31	Interest Expense<br>To accrue interest expense for December	$825$
Dec 31	Interest Payable		$825$