FIGURE 21-2 Notes Payable and related Interest Accounts Notes payable Interest Payments Beginning expense balance Interest principalIssue of expense new notes Ending balance Interest Cash payable in bank Beginning Issue of Payments of new Principa notes Payments of Payments/ Interest expense Interest terest ng balance @2000 Prentice hall.IncArens, Loebbecke; Auditing, 8/E ©2000 Prentice Hall, Inc. FIGURE 21 - 2 Notes Payable and Related Interest Accounts