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On January 1, Bestway, Inc. signed a $175,000, 8%, 30-year mortgage that requires semiannual payments of $7,735 on June 30 and December 31 of each year. The jou

On January 1, Bestway, Inc. signed a $175,000, 8%, 30-year mortgage that requires semiannual payments of $7,735 on June 30 and December 31 of each year. The journal entry for the first semiannual payment (with interest rounded to the nearest dollar) is

A. debit Interest expense, $7,000; debit Mortgage expense, $735; credit Cash, $7,735.
B. debit Interest expense, $735; debit Mortgage payable, $7,000; credit Cash, $7,735.
C. debit Mortgage payable, $7,735; credit Cash, $7,735.
D. debit Interest expense, $7,000; debit Mortgage payable, $735; credit Cash, $7,735.

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