31 OA a detl to Indenest Expense tor 154000 Oc adebit to int

31 OA a detl to Indenest Expense tor $154000 Oc adebit to interest Expense for $210,000 O D a credil to Cash olf 5310,000

Solution

Solution:

Principal outstanding on Dec 31, 2021 = $1,500,000 - $400,000 = $1,100,000

Interest expense for 2022 = $1,100,000 * 14% = $154,000

Therefore the entry to record annual payment on Dec 31, 2022 will include

\"A debit to interest expense for $154,000\"

Hence option A is correct.