1. Moss County Bank agrees to lend the Sadowski Brick Company $500,000 on January I Sadowski Brick Company signs a $500,000, 6%. 9-month note. What is the adjusting entry required if Sadowski Brick Company prepares financial statements on June 30?

(A) Interest payable Cash. . . . . . . . 15,000

Cash………….....................…………………………..15.000

(B) Interest Expense. . . …………….15,000

Interest Payable…. . .…........……………………..15,000

(C) Interest Payable . . . …………….15,000

Interest Expense. .………….....….....……………..15,000

(D) Interest Expense. . . …………….15,000

Cash. . . . . . . . .. .…………………..............………..15,000

2. Which of the following most likely would be classified as a current liability"

(A) Dividends payable

(B) Bonds payable in 5 years

(C) Mortgage payable as a single payment in 10 years

(D) Three-year notes payable

Answer rating: 100% (QA)

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