On May 1, 2021, Townsley borrowed $250,000 from Prime Bank by signing a three-year, 6% note payable. Interest is due each May 1. What adjusting entry, if any, should Prime Bank record on December 31, 2021?a. Debit Interest Receivable and credit Interest Revenue for $5,000.b. Debit Interest Receivable and credit Interest Revenue for $10,000.c. Debit Interest Receivable and credit Interest Revenue for $15,000.d. No adjusting entry is necessary.

b. Debit Interest Receivable and credit Interest Revenue for $10,000

Explanation:

The adjusting entry is shown below:

Interest receivable A/c Dr $1,260

                To Interest revenue A/c $1,260

(Being accrued interest is recorded)

The computation of accrued interest is shown below:

= Principal × rate of interest × number of months ÷ (total number of months in a year)  

= $250,000 × 6% × (8 months ÷ 12 months)

= $10,000

The 8 month is calculated from May 1 to December 31. And we assume the books are closed on December 31

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explanation:

1. avoid them

2. a talk with them

3. ask someone you trust

4. ignore

5. call police