Question

On July 1, a bank loaned $10,000 to a company in the form of a note receivable. The note requires interest at an annual rate of 10%, and all interest is payable (due) at maturity. The amount of interest revenue that the bank should accrue at the end of December is:

Answer 1

Answer:

$500

Explanation:

Annual interest revenue = $10,000 × 10% = $1,000

Interest revenue earned from July 1 to December 31 = $1,000 × (6/12) = $500.

Therefore, amount of interest revenue that the bank should accrue at the end of December is $500.