Answer:
The correct answer is C $41,250
Explanation:
For computing the interest revenue, first we have to calculate the present value and than compute the interest amount for both the years 2014 and 2015.
So,
Present value of notes = $500,000 × 0.75
= $375,000
Now, compute the interest earned for both the years
For 2014 = $375,000 × 10%
= $37,500
For 2015 =$37,500) × 10%
= $3750
So for 2015 = $37,500 + $3750 = $41,250
Hence, $41,250 of interest revenue should be included in Ball's 2015 income statement
Thus, the correct answer is $41,250
