During the fourth quarter ended December 31, year 1, Lighting Fixtures Inc. ( LFI) had average outstanding revolving bank loans of $ 1.2 million. Assume that the quarterly interest charges associated with these loans was $ 7,500. If LFI makes the interest payment to the banks on January 15, year 2, what is the journal entry ( if any) made by the company on December 31 to reflect the above?

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a Accrued Interest Payable b. nterest Expense c. Interest Expense 7500 Interest Expanse 7500 7500 Accrued Interest Payable 7500 7500 Loan Payable 7500 d. No journal entry necessary.