Question

In: Economics

On January 1, Portillo, Inc. lends a corporate customer $156,000 at 5% interest. The amount of...

On January 1, Portillo, Inc. lends a corporate customer $156,000 at 5% interest. The amount of interest revenue that should be recorded for the quarter ending March 31 equals:

Multiple Choice

  • $7,800.

  • $650.

  • $2,600.

  • $1,950.

Solutions

Expert Solution

Answer- Correct option is 'D'

Annual interest rate = 156,000 * 5 %

                            = 7800

Monthly interest rate = Annual interest rate / 12

                                =   7800 / 12

                                =    650

Quaterly interest rate = Monthly interest rate * 3

                                 =   650 * 3

                                 = 1950

The amount of interest revenue that should be recorded for the quarter ending March 31 equals $ 1950.

Rahul Sunny answered 6 months ago
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