On July 1 20X6 the company borrowed 20000 and must repay pri

On July 1, 20X6, the company borrowed $20,000 and must repay principal and accrued interest of 10% a year on July 1, 20X9. Based on this information, the debit to Interest Expense in the Adjustments column of the worksheet for 20X8 is: $4,000 $1,000 $2,000 $0

Solution

Answer is option C

$2,000

Borrowed amount = 20000

Annual interest rate = 10%

Interest expense for 20X8 = 20000*10% = 2000