Ask Question
15 July, 11:13

On December 1, Victoria Company signed a 90-day, 6% note payable, with a face value of $15,000. What amount of interest expense is accrued at December 31 on the note? (Use 360 days a year.)

+2
Answers (1)
  1. 15 July, 13:08
    0
    The $75 amount of interest expense is accrued at December 31 on the note.

    Explanation:

    The interest expense amount which is accrued at December 31 is shown below:

    = Face value * interest rate * months : total number of months

    = $15,000 * 6% * 1 : 12

    = $75

    where,

    total number of months is 12 in a year

    And, for 1 month we have to compute the accrued interest expense. The one month is calculated from December 1 to December 31.

    We don't recognized the signed days as we have to compute the interest expense till December 31. That's why we ignored this part.

    Thus, the $75 amount of interest expense is accrued at December 31 on the note.
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “On December 1, Victoria Company signed a 90-day, 6% note payable, with a face value of $15,000. What amount of interest expense is accrued ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers