Interest calculations, Accounting Basics

Calculate the amount of interest for each of the following independent situations (assume

365 days per year):

   
       

a)  $400,000 is borrowed at 6% interest for 1 year.

       
       

b)  $50,000 is borrowed at an annual interest rate of 4% for 60 days.

       
       

c)  $120,000 is borrowed at an annual interest rate of 7% for 275 days.

       
       

Answer:

     
   

Amount in $

 
       
 

Interest = Principal amount * Rate of interest*Time

       

a)

Interest amount

 =400,000*6%*1

 
   

                 24,000

 
       

b)

Interest amount

 =50,000*4%*60/365

   

                 328.77

 
       

c)

Interest amount

 =120,000*7%*275/365

   

              6,328.77

 

Posted Date: 7/12/2012 3:06:02 AM | Location : United States







Related Discussions:- Interest calculations, Assignment Help, Ask Question on Interest calculations, Get Answer, Expert's Help, Interest calculations Discussions

Write discussion on Interest calculations
Your posts are moderated
Related Questions
Q. Relevance information to financial reporting? To have relevance information should be pertinent to or affect a decision. The information should make a difference to someone

i want to clear concepts of journal


Q. Determine the cost of ending inventory? The company suppose that the 20 units in inventory consist of 10 units purchased December 21 and 10 units purchased October 12. The o

Explain the term- Reversing entries and Interim statements Reversing entries - Made the first day of new accounting period. They are exact opposite of the adjusting entries

What is ACOUNTS RECEIVABLE LEDGER Businesses have several customers and individual businesses aren't assigned an account number they are just in alphabetical order. Accounts

The Dividends account increases (debited) as well as an asset cash decreases (credited) by USD 3000. Transaction 15 brings to a close the analysis of the Micro Train Company transa

Q. Summary of significant accounting policies? As part of their annual reports companies comprise summaries of significant accounting policies. These policies help users in int

norman co borrows $15,000 with a 8%interest 38,000 account receivable paid $26,000 salary

Q. Illustrate perpetual inventory procedure? Data from Exhibit serves like the basis for some of the entries. You would debit the Merchandise Inventory account to record the en