Paula smith accepted a six month 9%, $10,000 note receivable from a customer on june 1. Smith has an arrangement with the Regency Bank to discount selected customer notes at 12%. If the note were discounted on July 1 under the terms of agreement with Regency Bank, which one of the following journal entries would Smith record?
a. DR Cash 10,000 CR notes receivable 10,000
b. DR cash 9,928 CR notes payable-Regency Bank 9.928
c. DR cash 9,928 DR interest Expense 72 CR notes receivable 10,000
d. DR cash 9,928 DR interest Expense 72 CR notes payable- Regency Bank 10,000