Question

Give the adjusting entry and closing entry for interest due o na loan taken

Answer 1

Tracking business activity with T accounts would be cumbersome because most businesses have a large number of transactions each day. These transactions are initially recorded on source documents, such as invoices or checks. The first step in the accounting process is to analyze each transaction and identify what effect it has on the accounts. After making this determination, an accountant enters the transactions in chronological order into a journal, a process called journalizing the transactions. Although many companies use specialized journals for certain transactions, all businesses use a general journal. In this book, the terms general journal and journal are used interchangeably.

Answer 2

Explanation:

(I) partner's capital a/c dr.

to interest on loan a/c

(ll) interest on loan a/c dr.

to p/l a/c

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