Marla Company borrowed $100,000 on a 10-year, 7% installment note payable on January 1, 2005. The terms of the note require Marla to pay 10 equal payments of $14,238 each December 31 for 10 years. The required general journal entry to record the first payment on the note on December 31, 2005 will involve:
A) a debit to Notes Payable of $10,000
B) a debit to Cash of $14,238
C) a debit to Interest Expense of $14,238
D) a debit to Notes payable of $14,238
E) a debit to Notes Payable of $7,238
Ans: E) a debit to Notes Payable of $7,238
Business
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