Ramos Company has a 90-day note that carries an annual interest rate of 8%. If the amount of the total interest on the note is equal to $700, what is the note's principal? a. $8,750 b. $35,000 c. $50,400 d. $22,400

Principles of Accounting Volume 1
19th Edition
ISBN:9781947172685
Author:OpenStax
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Chapter12: Current Liabilities
Section: Chapter Questions
Problem 15MC: Marathon Peanuts converts a $130,000 account payable into a short-term note payable, with an annual...
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Ramos Company has a 90-day note that carries an annual interest
rate of 8%. If the amount of the total interest on the note is equal to
$700, what is the note's principal?
a. $8,750
b. $35,000
c. $50,400
d. $22,400
Transcribed Image Text:Ramos Company has a 90-day note that carries an annual interest rate of 8%. If the amount of the total interest on the note is equal to $700, what is the note's principal? a. $8,750 b. $35,000 c. $50,400 d. $22,400
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