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A company borrows as follows: amortiza oustanding t interest instalment tion amount 0 0 301.386 0 3.000.000 1 90.000 301.386 211.386 2.788.614 2 83.658 301.386 217.728 2.570.886 3 77.127 301.386 224.260 2.346.626 4 70.399 301.386 230.987 2.115.639 5 63.469 301.386 237.917 1.877.722 6 56.332 301.386 245.055 1.632.667 7 48.980 301.386 252.406 1.380.261 8 41.408 301.386 259.978 1.120.282 9 33.608 301.386 267.778 852.505 10 25.575 301.386 275.811 576.693 11 17.301 301.386 284.085 292.608 12 8.778 301.386 292.608 Loan was requested on 31 October 2019 and instalments are monthly. It is requested: a. Make accounting entries for year finished 2019. b. If company were to make a full prepayment on 15 January 2020, how much would it have to pay? Make respective accounting entry(s). Note: Remember that, to transform monthly interest rate to fortnightly interest rate, following formula must be applied: (1 + i_monthly)^ = (1+i_fortnightly) c. If at the time of applying for credit, agreed term for debt had been 9 months instead of 12 months, how much would instalment have been? d. If loan had been requested on 30 September, how much would 'interest expense' be in income statement for year 2019 and year 2020? Detail calculations.

A company borrows as follows: amortiza oustanding t interest instalment tion amount 0 0 301.386 0 3.000.000 1 90.000 301.386 211.386 2.788.614 2 83.658 301.386 217.728 2.570.886 3 77.127 301.386 224.260 2.346.626 4 70.399 301.386 230.987 2.115.639 5 63.469 301.386 237.917 1.877.722 6 56.332 301.386 245.055 1.632.667 7 48.980 301.386 252.406 1.380.261 8 41.408 301.386 259.978 1.120.282 9 33.608 301.386 267.778 852.505 10 25.575 301.386 275.811 576.693 11 17.301 301.386 284.085 292.608 12 8.778 301.386 292.608 Loan was requested on 31 October 2019 and instalments are monthly. It is requested: a. Make accounting entries for year finished 2019. b. If company were to make a full prepayment on 15 January 2020, how much would it have to pay? Make respective accounting entry(s). Note: Remember that, to transform monthly interest rate to fortnightly interest rate, following formula must be applied: (1 + i_monthly)^ = (1+i_fortnightly) c. If at the time of applying for credit, agreed term for debt had been 9 months instead of 12 months, how much would instalment have been? d. If loan had been requested on 30 September, how much would 'interest expense' be in income statement for year 2019 and year 2020? Detail calculations.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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A company borrows as follows: amortiza oustanding t interest instalment tion amount 0 0 301.386 0 3.000.000 1 90.000 301.386 211.386 2.788.614 2 83.658 301.386 217.728 2.570.886 3 77.127 301.386 224.260 2.346.626 4 70.399 301.386 230.987 2.115.639 5 63.469 301.386 237.917 1.877.722 6 56.332 301.386 245.055 1.632.667 7 48.980 301.386 252.406 1.380.261 8 41.408 301.386 259.978 1.120.282 9 33.608 301.386 267.778 852.505 10 25.575 301.386 275.811 576.693 11 17.301 301.386 284.085 292.608 12 8.778 301.386 292.608 Loan was requested on 31 October 2019 and instalments are monthly. It is requested: a. Make accounting entries for year finished 2019. b. If company were to make a full prepayment on 15 January 2020, how much would it have to pay? Make respective accounting entry(s). Note: Remember that, to transform monthly interest rate to fortnightly interest rate, following formula must be applied: (1 + i_monthly)^ = (1+i_fortnightly) c. If at the time of applying for credit, agreed term for debt had been 9 months instead of 12 months, how much would instalment have been? d. If loan had been requested on 30 September, how much would 'interest expense' be in income statement for year 2019 and year 2020? Detail calculations.
Transcribed Image Text:A company borrows as follows: amortiza oustanding t interest instalment tion amount 0 0 301.386 0 3.000.000 1 90.000 301.386 211.386 2.788.614 2 83.658 301.386 217.728 2.570.886 3 77.127 301.386 224.260 2.346.626 4 70.399 301.386 230.987 2.115.639 5 63.469 301.386 237.917 1.877.722 6 56.332 301.386 245.055 1.632.667 7 48.980 301.386 252.406 1.380.261 8 41.408 301.386 259.978 1.120.282 9 33.608 301.386 267.778 852.505 10 25.575 301.386 275.811 576.693 11 17.301 301.386 284.085 292.608 12 8.778 301.386 292.608 Loan was requested on 31 October 2019 and instalments are monthly. It is requested: a. Make accounting entries for year finished 2019. b. If company were to make a full prepayment on 15 January 2020, how much would it have to pay? Make respective accounting entry(s). Note: Remember that, to transform monthly interest rate to fortnightly interest rate, following formula must be applied: (1 + i_monthly)^ = (1+i_fortnightly) c. If at the time of applying for credit, agreed term for debt had been 9 months instead of 12 months, how much would instalment have been? d. If loan had been requested on 30 September, how much would 'interest expense' be in income statement for year 2019 and year 2020? Detail calculations.
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