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12 February, 17:10

On december 1, victoria company signed a 90-day, 7% note payable, with a face value of $15,600. what amount of interest expense is accrued at december 31 on the note? (use 360 days a year.)

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  1. 12 February, 18:14
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    The answer should be $91. 7% of $15,600 is $1092. (Divide 15600 by 100, then multiply the result by 7). Divide 1092 by 360, and you get a result of 3.03 for your "daily interest" accrual, as spread out over a 360 day year. Then multiply that amount (3.03) by the 30 days between the 1st and the 31st, and you get 91.
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