Harrison Corporation borrowed $35,000 from F&M Bank on June 1 of the current year. The bank required 7% interest. Interest will be paid when the nine-month note becomes due. What is the interest expensefor the current year? (Do not round intermediate calculations. Only round your final answer to the nearest dollar.)A. $0B. $2,450C. $1,225D. $1,429

Harrison Corporation borrowed $35,000 from F&M Bank on June 1 of the current year, and the bank…

Answered: Harrison Corporation borrowed $35,000…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter16: Working Capital Policy And Short-term Financing

Section: Chapter Questions

Problem 14P

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Marathon Peanuts converts a $130,000 account payable into a short-term note payable, with an annual interest rate of 6%, and payable in four months. How much interest will Marathon Peanuts owe at the end of four months? A. $2,600 B. $7,800 C. $137,800 D. $132,600
Sub-Cinema Inc. borrowed $10,000 on Jan. 1 and will repay the loan with 12 equal payments made at the end of the month for 12 months. The interest rate is 12% annually. If the monthly payments are $888.49, what is the journal entry to record the cash received on Jan. 1 and the first payment made on Jan. 31?
A ski company takes out a $400,000 loan from a bank. The bank requires eight equal repayments of the loan principal, paid annually. Assume no interest is paid or accumulated on the loan until the final repayment. How much of the loan principal is considered a current portion of a noncurrent note payable in year 3? A. $50,000 B. $150,000 C. $100,000 D. $250,000
Jain Enterprises honors a short-term note payable. Principal on the note is $425,000, with an annual interest rate of 3.5%, due in 6 months. What journal entry is created when Jain honors the note?
Harrison Corporation borrowed $39,000 from F&M Bank on June 1 of the current year. The bank required 8% interest. Interest will be paid when the nine-month note becomes due. What is the interest expense for the subsequent year in which the note is due and paid? (Do not round intermediate calculations. Only round your final answer to the nearest dollar.) ○ A. $1,560 OB. $1,820 OC. $520 OD. $2,340
Harrison Corporation borrowed $35,000 from F&M Bank on June 1 of the current year. The bank required 9% interest. Interest will be paid when the nine-month note becomes due. What is the amount that will be paid upon maturity of the note? (Do not round intermediate calculations. Only round your final answer to the nearest dollar.) A. $38,150 B. $37,363 C. $35,525 ○ D. $35,000
Assuming a 360-day year, the interest charged by the bank, at the rate of 7%, on a 90-day, discounted note payable of $124,800 is ______ .Round your answer to the nearest whole dollar. a.$2,184 b.$8,736 c.$4,368 d.$124,800
Roseland Design borrowed $700,000 on a 90-day note from CorpOne Funding Company. CorpOne discounts the note at 8%. (Assume a 360-day year is used for interest calculations.) Required: 1. Journalize Roseland's entries to record: a. The issuance of the note. b. The payment of the note at maturity. If an amount box does not require an entry, leave it blank. а. b. 2. Journalize CorpOne's entries to record: a. The receipt of the note. b. The receipt of the payment of the note at maturity. If an amount box does not require an entry, leave it blank. а. b.
Martinez Co. borrowed $79,200 on March 1 of the current year by signing a 60-day, 9%, interest-bearing note. Assuming a 360-day year, when the note is paid on April 30, the entry for the payment should include a Round your answer to the nearest whole dollar. Oa. debit to Interest Payable for $1,188 Ob. debit to Interest Expense for $1,188 Oc. credit to Cash for $79,200 Od. credit to Cash for $86,328
Harris Company borrows money from the Whitestar Bank and signs an interest-bearing promissory note. Principal Term Interest $3,600 120 days $72 Required: Given the details above, determine the interest rate on the note. Note: To simplify the arithmetic, use 360 days in a year. 0% Interest rate:
Hernandez Engineering borrows $5,500, at 6 1 2 % interest, for 150 days. If the bank uses the ordinary interest method, how much interest (in $) will the bank collect? (Round your answer to the nearest cent.)
ABC Company acquired a loan from New Kensington Bank in the amount of $120,000 with a 8% interest rate. The loan will be repaid in exactly one year. A stipulation of the loan requires ABC Company to keep a compensating balance of $25,000 in a New Kensington Bank checking account. What is the effective interest rate that ABC Company will pay? Please round to the second decimal place. 10.11% 9.67% 8.00% 6.62%

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