Can you pelase explain this Question Broken Brady Inc. borrowed $250,000 on June 30, 2021. The loan bears annual interest at 10% and interest payments are made semi-annually on December 31 and June 30 of each year. In connection with this loan, how much interest payable should be reported at December 31, 2021? $25,000. None of the answers are correct. $50,000. $12,500. $8,000.
Can you pelase explain this Question Broken Brady Inc. borrowed $250,000 on June 30, 2021. The loan bears annual interest at 10% and interest payments are made semi-annually on December 31 and June 30 of each year. In connection with this loan, how much interest payable should be reported at December 31, 2021? $25,000. None of the answers are correct. $50,000. $12,500. $8,000.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Can you pelase explain this Question
Broken Brady Inc. borrowed $250,000 on June 30, 2021. The loan bears annual interest at 10% and interest payments are made semi-annually on December 31 and June 30 of each year. In connection with this loan, how much interest payable should be reported at December 31, 2021?
$25,000.
None of the answers are correct.
$50,000.
$12,500.
$8,000.
Expert Solution
Step 1
Interest payable is an amount that shows the earned portion of interest by the investors is still unpaid. It creates liabilities on the part of the company and is reported on the current liabilities section of the balance sheet of the company.
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