AT E F E9-2A B D 1 a) What is the amount of interest payable at December 31, Year 12 2 3 4 b) What is the amount of interest expense in Year 1? 5 6 c) What is the amount of interest paid in Year 1? 7 8 9 d) Record the journal entry for each event. 10 11 12 Event Account Debit Credit 13 1. 14 15 16 2 17 18 19 13 20 21 22 23 25 26 27 28 29 30 ome statement? LO 9-1 12 ying ere the Exercise 9-2A Effects of recognizing accrued interest on financial statements Bill Darby started Darby Company on January 1, 2016. The company experienced the following events during its first year of operation: 1. Earned $16,200 of cash revenue. 2. Borrowed S12.000 cash from the bank 3. Adjusted the accounting records to recognize accrued interest expense on the bank note. The note, issued on September 1, 2016, had a one-year term and an 8 percent annual interest rate. Required 1. What is the amount of interest payable at December 31, 2016? b. What is the amount of interest expense in 2016? c. What is the amount of interest paid in 2016? d. Use a horizontal statements model to show how each event affects the balance sheet, income statement, and statement of cash flows. Indicate whether the event increases (1). decreases (D), or does not affect (NA) each element of the financial statements. In the Cash Flows column, designate the cash flows as operating activities (OA), investing activities (IA), or financing activities (FA). The first transaction has been recorded as an example. face creste am od po mohad vor Balance Sheet Event No. Income Statement Cash Notes Pay. + Int. Pay. + Com. Stk. + Ret. Earn. Rev. Exp. = Net Inc. Statement of Cash Flows 1 NA NA NA NA 1 OA Eve