Sodium Inc. borrowed $175,000 on April 1. The note requires interest at 12% and principal to be paid in one year. How much inter

Question

Mazyrski [523]

3 years ago

11

Sodium Inc. borrowed $175,000 on April 1. The note requires interest at 12% and principal to be paid in one year. How much inter

est is recognized for the period from April 1 to December 31?

Business

1 answer:

Oksanka [162] · Answer 1 · 2022-08-18T13:32:25+03:00

Answer:

The amount of interest that is recognized for the period from April 1 to December 31 is $15,750

Explanation:

According to the given data we have the following:

interest=12%

From April 1 to December 31 we have 9 months

Sodium Inc. borrowed $175,000

Therefore, in order to calculate the amount of interest that is recognized for the period from April 1 to December 31 we would have to make the following calculation:

Interest for 9 months= $175,000 x 12% x 9 months / 12

Interest for 9 months=$15,750

The amount of interest that is recognized for the period from April 1 to December 31 is $15,750