The total amount of interest that will be paid on a four-month, $6,500, 9% note payable...

The total amount of interest that will be paid on a four-month, $6,500, 9% note payable equals:

Multiple Choice

$585.

$292.

$146.

$195.

Solutions

Expert Solution

* All working forms part of the answer

* Note is of 4 months, hence 4 month interest will be paid.

* Working

A	Amount of Note	$ 6,500.00
B	Interest rate [annual]	9%
C = A x B	Annual [12 months] interest	$ 585.00
D = C x (4 months/12months)	4 months Interest	$ 195.00 [585 x (4/12)]

* Hence, the correct answer is Option 4th (Last Option): $ 195

ekkarill92 answered 1 year ago

Next > < Previous

Related Solutions

NOTE FOR QUESTION 9: In a discount interest loan, the interest is deducted from the amount...

NOTE FOR QUESTION 9: In a discount interest loan, the interest is deducted from the amount the borrower receives at the beginning of the loan. For example, if a bank makes a one-year loan of $10,000 at a simple interest rate of 5%, the borrower essentially borrows $9,500 at the beginning of the year and repays it with no interest at the end of the year. 9.A bank offers your firm a discount interest loan at 8.25 percent for up...

>Paid 25,000 of principle and 1250 of interest expense on the note payable to first bank...

>Paid 25,000 of principle and 1250 of interest expense on the note payable to first bank Paid 10,000 on the mortgage principle and 800 of interest expense to commerece bank How would i Jornalize this in accounting can somone help me and explain to me thanks

1. Assuming a 360-day year, when a $50,000, 90-day, 9% interest-bearing note payable matures, total payment...

1. Assuming a 360-day year, when a $50,000, 90-day, 9% interest-bearing note payable matures, total payment will be a) 51,125 b) 4,500 c) 54,500 d) 1,125 2. Chang Co. issued a $50,000, 120-day, discounted note to Guarantee Bank. The discount rate is 6%. Assuming a 360-day year, the cash proceeds to Chang Co. are a) $49,000 b) $49,750 c) $51,000 d) $47,000 3. The journal entry used to record the issuance of an interest-bearing note for the purpose...

On September 1, 2021, Daylight Donuts signed a $171,000, 6%, six-month note payable with the amount...

On September 1, 2021, Daylight Donuts signed a $171,000, 6%, six-month note payable with the amount borrowed plus accrued interest due six months later on March 1, 2022. Daylight Donuts should report interest payable at December 31, 2021, in the amount of: (Do not round your intermediate calculations.)

22. On November 1, 2021, Jory Laundry signed a $100,000, 9%, six-month note payable with the...

22. On November 1, 2021, Jory Laundry signed a $100,000, 9%, six-month note payable with the amount borrowed plus accrued interest due six months later on May 1, 2022. Jory Laundry records the appropriate adjusting entry for the note on December 31, 2021. In recording the payment of the note plus accrued interest at maturity on May 1, 2022, Jory Laundry would: A) Debit Interest Payable, $3,000 B) Debit Interest Expense, $1,500 C) Debit Interest Payable, $1,500 D) Debit Interest...

What amount of interest is paid in month 31 of a partially amortizing mortgage loan for...

What amount of interest is paid in month 31 of a partially amortizing mortgage loan for $200,000 at 8% interest for 20 years with an agreed-upon balloon payment of $40,000 at maturity? Enter your answer rounded to the nearest penny with no punctuation other than a decimal point.

Which of the following is true regarding interest?a) Interest payable increases by the amount of...

Which of the following is true regarding interest?a) Interest payable increases by the amount of interest expense each year.b) When interest is paid, both interest payable and interest expenses are reduced.c)The balance of interest payable reduces net income in every period.d) Inerest expense and interest payable should always have the same balance.

Oriole Company receives a $78,000, 10-year note bearing interest of 9% (paid annually) from a customer...

Oriole Company receives a $78,000, 10-year note bearing interest of 9% (paid annually) from a customer at a time when the discount rate is 11%. (For calculation purposes, use 5 decimal places as displayed in the factor table provided.) What is the present value of the note received by Oriole? (Round answer to 2 decimal places, e.g. 25.25.) Present value of note received = ??

Mike Kornas signed a 12-month, 9% p.a. simple interest promissory note for $9,725 with MacDonald’s Furniture....

Mike Kornas signed a 12-month, 9% p.a. simple interest promissory note for $9,725 with MacDonald’s Furniture. After 85 days, MacDonald’s Furniture sold the note to the Royal Bank at a rate of 11%, then Royal Bank resold the note to Friendly Finance Company 42 days later at a rate of 6.25%. Find the gain or loss on this note for each company and bank involved, as well as a rate of return realized

13. Mike Kornas signed a 12-month, 9% p.a. simple interest promissory note for $9,725 with MacDonald’s...

13. Mike Kornas signed a 12-month, 9% p.a. simple interest promissory note for $9,725 with MacDonald’s Furniture. After 85 days, MacDonald’s Furniture sold the note to the Royal Bank at a rate of 11%, then Royal Bank resold the note to Friendly Finance Company 42 days later at a rate of 6.25%. Find the gain or loss on this note for each company and bank involved, as well as a rate of return realized. (Don’t forget to add 3 grace...

Subjects