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A company has a five-year, $100,000 note payable on which it has been making annual interest payments of $6,000. This is the final year of the note, and the company has made a $106,000 payment to pay this year's interest as well as to repay the note itself.
Problem 1: What is needed in the journal entry to record this $106,000 cash payment?
A. Credit to note payable for $100,000B. Debit to note payable for $100,000C. Credit to interest expense for $6,000D. Debit to interest expense for $106,000
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