Answer:
The accrued interest payable on December 31, 2017 is $15,453.33.
Explanation:
When Mura Company signs a 90-day, 12% note payable the entries are as follows :
Cash $190,000 (debit)
Note Payable $190,000 (credit)
On December 31, 2017 when Interest acrues on the loan the entries are as follows :
<em>Note : Two months interest or 61 days interest would have expired</em>
Interest Expense $15,453.33 (debit)
Note Payable $15,453.33 (credit)
Interest expense = $190,000 × 12% × 61/90
= $15,453.33
Conclusion :
The accrued interest payable on December 31, 2017 is $15,453.33.
