Problem:
Samco signed a 7-year note payable on January 1, 2025, of $420,000. The note requires annual principal payments each December 31 of $60,000 plus interest at 10%. The entry to record the annual payment on December 31, 2026, includes • A. a credit to Notes Payable for S60,000.1 • B. a debit to Interest Expense for $36,000. • C. a debit to Interest Expense for $42,000. • D. a credit to Cash of $102,000.