Answer:
The interest income to be perceived in the current financial year is $350.
Explanation:
Figure the interest Amount on note for the time of note of 120 days as demonstrated as follows:
Interest Amount on note = Face estimation of note x Rate of interest x 120 days/360 days
Interest Amount on note = $84,000 x 5% x 120/360
Interest Amount on note = $4,200 x 120/360
Interest Amount on note = $1400
Therefore, the interest Amount for the time of note of 120 days is $1,400
Clarification
Financing cost given in the inquiry is per annum. However, the note gave is 120-day note. Enthusiasm on note will be just for 120 days. So as to ascertain the interest Amount for the time of the note of 120 days, increase the face value of the note with the pace of interest. Presently, increase the resultant incentive with 120/360
Process the interest to be perceived for the current fiscal year finishing June 30 as demonstrated as follows:
Interest income = Interest income for 120 days x Number of days from June 1 to June 30/120 days
Interest income = $1,400 x 30days/120 days
Interest income = $350
In this manner, the interest income to be perceived for the current financial year finishing June 30 is $350
The interest income to be perceived in the current fiscal year is $350.
Clarification
The note payable was given on June 1 of the current financial year and the monetary year finishes on June 30. In this manner, the interest income will be perceived is for the period between June first to June 30th (30 days).
In this way, to compute the interest income for 30 days, increase the interest income for 120 days with 30 days and gap by 120 days.
