Answer:
wages expense 1,300 debit
wages payable 1,300 credit
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interest expense 200 debit
interest payable 200 credit
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account receivable 2,400 debit
service revenue 2,400 credit
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Explanation:
we recognize the wages expense for the current period and the liability that arise from that.
interest: principal x rate x time
time and rate should be in the same metric so we express the time in portion of a year.
From July 1st to July 31th a month has past so 1/12 of a year:
20,000 x 12% x 1/12 = 200
this will be the accrued interest for the period
we must record service revenue. As it is not collected it goes int oaccount receivable
