On January 1, which of the following journal entries will be made by Backyard to record the proceeds and issue of the note?
A) Option A
B) Option B
C) Option C
D) Option D

Question

On January 1, which of the following journal entries will be made by Backyard to record the proceeds and issue of the note?  
A) Option A 
B) Option B 
C) Option C 
D) Option D

Quizplus · Accepted Answer

Option B correctly records the proceeds and issuance of the note. The company received $100,000 in cash, which is recorded as a debit to Cash. They issued a note for $100,000, which is recorded as a credit to Notes Payable.

On January 1, Which of the Following Journal Entries Will