Travis County Bank agrees to lend Brickyard Corporation $200,000 on January 1. Brickyard signs a $200,000, 4%, 9-month note. Interest is due at maturity on September 30. The company's fiscal year ends June 30 and adjusting entries are recorded at that time only. 1. What adjusting entry should Brickyard make on June 30 before preparing its annual financial statements?

a. Debit Interest Expense and credit Interest Payable for $4,000
b. Debit Cash and credit Interest Payable for $4,000
c. Debit Cash and credit Interest Expense for $4,000
d. Debit Interest Payable and credit Interest Expense for $4,000

2. What journal entry will Brickyard make when paying the interest at maturity?

a. Debit Notes Payable and credit Cash for $206,000
b. Debit Interest Expense for $4,000, and credit Cash for $4,000
c. Debit Interest Expense for $6,000 and Cash for $206,000
d. Debit Interest Payable for $4,000, debit Interest Expense for $2,000, and credit Cash for $6,000

German brothels recently began offering a monthly subscription service for multiple purchasers. if you thought that the brothels' encouragement of prostitution was immoral to begin with, would you consider this pricing plan to be even more immoral? suppose a particular patron at a german brothel has the following willingness-to-pay schedule for services at the brothel, per session. session willingness to pay 1st $84 2nd $72 3rd $60 4th $48 5th $36 6th $24 suppose this consumer would not demand any more sessions, even for free. also assume that the marginal cost to the brothel, per session, is constant at $12. at a price of $78.00 per session, the number of sessions demanded by this consumer would be . at this price and quantity, consumer surplus is $ and producer surplus is $ . suppose the brothel has devised a new pricing scheme for consumers who demand more than 1 session. this pricing scheme is a subscription service, whereby consumers can pay a flat fee of $259.20 and can have up to 6 sessions total. using this subscription pricing model, this consumer would demand sessions. under this scenario, consumer surplus is $ and producer surplus is $ . (hint: for consumer surplus, consider how much total value the consumer places on all sessions, versus the total price paid.)