Reality Corporation borrowed $175,000 on April 1. The note requires interest at 12% and principal to be paid in one year. How much interest is recognized for the period from April 1 to December 31? Select one: O a. $15,750. O b. $5,250. O c. $21,000. O d. $0.

Reality Corporation borrowed $175,000 on April 1. The note requires interest at 12% and principal to be paid in one year. How much interest is recognized for the period from April 1 to December 31? Select one: O a. $15,750. O b. $5,250. O c. $21,000. O d. $0.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Company K borrowed $10,000 on November 1. The note has an interest rate of 8% and a term of 120…

A: Notes are a form of debt or loan for the business, on which it has to make regular interest…

Q: Roseland Design borrowed $700,000 on a 90-day note from CorpOne Funding Company. CorpOne discounts…

A: A note payable is a written arrangement between the two individuals in which one promises to pay the…

Q: Halep Inc. borrowed $56,000 from Davis Bank and signed a 4-year note payable stating the interest…

A: Amortization refers to expensing the acquisition cost minus residual value of assets in a systematic…

Q: question 1 ABC Company borrowed $100,000 on January 1, 20X1. Interest is 5% payable each December…

A: Solution.. Amount = $100,000 Interest expense= 5% Time period = 1 year Interest expense = ?

Q: Harris Company borrows money from the Whitestar Bank and signs an interest-bearing promissory note.…

A: Interest Rate = Interest * 100 * 360 / (Days * Principal)

Q: • Assume Strand Corp borrowed $200,000 from the bank on 7/1/20; Strand is a calendar year-end.…

A: Journal entry on 07/1/20 , 12 /31/ 20 are as follows

Q: Assuming a 360-day year, the interest charged by the bank, at the rate of 6%, on a 90-day,…

A: Interest charged by the bank -Interest is still calculated as Principal x Interest x Frequency of…

Q: 2, 69 st dol

A: Answer : Interest = Notes value * Interest rate * Days Interest = $75,972 * 6%*120/360 Interest =…

Q: Halep Inc. borrowed $26,000 from Davis Bank and signed a 4-year note payable stating the interest…

A: Notes payable represent the obligation raised by the corporation by issuing notes to the lender…

Q: Campus Flights takes out a bank loan in the amount of $210,000 on March 1. The terms of the loan…

A: Loan is defined as the amount collected on pre-decided terms and conditions and on the obligation…

Q: Prepare an amortization table showing the principal and interest in each payment.

A: Interest calculation : Outstanding principal amount * rate of interest Year 1 = $58,000 * 4%…

Q: Silver Company received a two-month, 6% note for $16,000 on Aug. 5. Which of the following…

A: Interest on a note payable is the cost incurred for borrowing money. When a business borrows funds…

Q: Sterling Inc. has two long-term notes outstanding. One is a five-year note for $50,000. An equal…

A: The balance sheet represents the financial position of the business with assets and liabilities on a…

Q: Proceeds from Notes Payable On January 26, Nova Co. borrowed cash from Conrad Bank by issuing a…

A: On a company's balance sheet, the notes payable account shows the debt the company has to creditors…

Q: On April 1, 20X1, Nelsen Inc. accepts a $100,000, 8% note. The note receivable and interest are due…

A: Note Receivable: It implies a promissory note which is written by the borrower in the favor of…

Q: 1-Jan Janus Corp. lent $66, 116 to Jeeter Company, accepting Jeeter's 2 year, $80,000 Date Account…

A: Interest bearing notes:These notes have a stated rate of interest that is payable in addition to the…

Q: lingerland borrowed $6,000 on July 20, at 11% interest. If the loan was due on October 15, what was…

A: given, p= $6000 r = 11% n = 87 ( july 20 - oct 15)

Q: Halep Inc. borrowed $54,000 from Davis Bank and signed a 4-year note payable stating the interest…

A: Given: Period = 4 years Payment = $14,876.46 Loan = $54,000 Interest rate = 4%

Q: • Assume Strand Corp borrowed $200,000 from the bank on 7/1/20; Strand is a calendar year-end.…

A: It is pertinent to note that under the accrual basis of accounting transactions are recorded as and…

Q: A $40,000 loan at 4% dated June 10 is due to be paid on October 11. The amount of interest is…

A: Loan amount (P) = $40000 Interest rate (r) = 4% Period from June 10 to Oct 11 (d) = 123 Days

Q: (a) The company's proceeds from the note $_ Computations: (b) The company's interest earned (net of…

A: Notes payable accounts are essential because they provide management or finance teams in many…

Q: Halep Inc. borrowed $32,000 from Davis Bank and signed a 4-year note payable stating the interest…

A: Note payable refers to a negotiable instrument. It represents the claim amount due on the acceptor.…

Q: On November 1, Alan Company signed a 120-day, 11% note payable, with a face value of $23,400. What…

A: The time value of money (TVM) is a fundamental concept in finance that reflects the idea that a…

Q: Campus Flights takes out a bank loan in the amount of $210,000 on March 1. The terms of the loan…

A: Laon amortization schedule means where repayment during the life of loan is written with interest.

Q: Peachtree Company borrows $23,000 from the local bank at 5% interest. The term of the note is 5…

A: Under installment note financing, the amount is borrowed with the promise to repay at predetermined…

Q: On September 1, Purifier Company borrowed $12,000 on a 6-month, 4%, short-term note payable. How…

A: Interest will be paid on March 1 = Amount borrowed x rate of interest x no. of months / 12 months

Q: On January 1, a company borrowed cash by issuing a $430,000, 4%, installment note to be paid in…

A: Amortiazation table:An amortization table is a financial tool that breaks down principle and…

Q: Subject : Accounting On January 1, Boston Company completed the following transactions (use a 7%…

A: PV is the way of calculating the present value of cash flows arising in the future present value of…

Q: On February 20th, a 5 month note for $3,700 was received by Lucky Company to settle an amount owing…

A: Interest is a amount which is paid by a borrower to the person from the money has been taken by him…

Q: On June 5 Glover Co. issued a $60,000, 6%, 120-day note payable to Jones Co. How much will Glover…

A: Step 1: Formula Interest = Principal x interest rate x yearMaturity value = Principal + Interest…

Q: On January 1, New York Company borrowed $180,000 to purchase machinery and agreed to pay 5% interest…

A: FUTURE VALUE Future value is the value of an asset at a specific date. Future value is the value…

Q: On February 20th, a 5 month note for $2,900 was received by Lucky Company to settle an amount owing…

A: A you have asked multiple sub-parts we can solve only first three part for you please repost the…

Q: Royalty Inc. lends to Shakespeare LTD. $50,000 on November 16. Shakespeare LTD. signs the 10%,…

A: The day when the borrower is required to make their very last payment on their loan is referred to…

Q: Company borrowed $5,000 on October 1, Year 1. The note had a one-year term and an annual interest…

A: Lets understand the basics.Adjusting entry is having three types which are,(1) Accruals(2)…

Q: A business issued a 45-day, 6% note for $210,000 to a creditor. Principal and interest are payable…

A: Notes are short term financial intrument with a fixed maturity period and usually short term…

Q: On July 8, Action Co. issued an $80,000, 6%, 90-day note payable to Scanlon Co. Assuming a 360-day…

A: The note is the liability on which a specific percentage of interest has to be paid over the…

Q: Central Auto Parts borrowed $550,000 at 9% interest on July 10 for 140 days. (a) If the bank uses…

A: Interest refers to the cost of borrowing money, usually expressed as a percentage of the amount…

Q: Campus Flights takes out a bank loan in the amount of $210,000 on March 1. The terms of the loan…

A: Solution: Amount of bank loan = $210,000 Interest rate = 9% Period = 10 years Date of loan = March 1

Q: On June 8, Williams Company issued an $75,972, 6%, 120-day no required, round your answer to the…

A: Maturity amount is the amount that has to be paid at the end of the life of bond or notes payable.…

Q: Joni Corporation borrows $500,000 from Bank A on Feb. 1, 20X8. The principal will not be repaid…

A: Liabilties are the amount of dues that need to be settled by the business. Liability can be for…

Concept explainers

Calculating the Return On A Loan

Question

Reality Corporation borrowed $175,000 on April 1. The note requires interest at 12% and
principal to be paid in one year. How much interest is recognized for the period from
April 1 to December 31?
Select one:
a. $15,750.
b. $5,250.
c. $21,000.
O d. $0.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

On June 8, Williams Company issued an $74,068, 8%, 120-day note payable to Brown Industries. Assuming a 360-day year for your calculations, what is the maturity value of the note? When required, round your answer to the nearest dollar. a.$79,993 b.$76,043 c.$74,068 d.$5,925
Company G borrowed $10,000 on November 1. The note has an interest rate of 8% and a term of 120 days. What is the amount of interest expense Company G should record on 12/31 of the first year? (Use 360 days a year.)
please help me
On Sept 1, 20X1, Orange Co borrowed P240,000 from ABC Bank to fund a new business venture. Orange issued a 6-month 12% promissory note. Principal and interest is payable on maturity date . REQUIRED: Journal entries from Sept 1 until the note matures.
On June 8, Williams Company issued an $80,000, 5%, 120-day note payable to Brown Industries. Assuming a 360-day year, what is the maturity value of the note? When required, round your answer to the nearest dollar. a. $82,600 b. $84,000 c. $81,333 d. $88,200
Gray Inc. lends White Ltd. $60,000 on April 1, accepting a 6-month, 4.5% interest note. Interest is due the first of each month, commencing May 1. Gray Inc. has an April 30 year-end. What adjusting entry should be made before the financial statements can be prepared? Cash 225 Interest Revenue. 225 Note Receivable. Cash. 60,000 60,000 Interest Receivable. Interest Revenue. 1,350 1350 Interest Receivable.. Interest Revenue. 225 225
P. nil
A bank customer borrows X at an annual effective rate of 12.5% and makes level payments at the end of each year for n years. (i) The interest portion of the final payment is 153.86. (ii) The total principal repaid as of time (n − 1) is 6009.12. (iii) The principal repaid in the first payment is Y. Calculate Y. OA. 500 OB. 470 O C. 480 O D. 490 OE. 510
Halep Inc. borrowed $36,000 from Davis Bank and signed a 4-year note payable stating the interest rate was 4% compounded annually. Halep Inc. will make payments of $9,917.64 at the end of each year. Prepare an amortization table showing the principal and interest in each payment. Round your answers to two decimal places. Year BeginningBalance Payment Interest To Principal EndingBalance 1 $fill in the blank 1 $fill in the blank 2 $fill in the blank 3 $fill in the blank 4 $fill in the blank 5 2 fill in the blank 6 fill in the blank 7 fill in the blank 8 fill in the blank 9 fill in the blank 10 3 fill in the blank 11 fill in the blank 12 fill in the blank 13 fill in the blank 14 fill in the blank 15 4 fill in the blank 16 fill in the blank 17 fill in the blank 18 fill in the blank 19 fill in the blank 20
Subject: accounting
On June 8, Williams Company issued an $72,000, 7%, 120-day note payable to Brown Industries. Assuming a 360-day year, what is the maturity value of the note? Round your answer to the nearest whole dollar. a. $5,040 b. $73,680 c. $77,040 Od. $72,000
6) A company receives a 5%, 90-day note for $5,400. The total interest due on the maturity date is: (Use 360 days a year.) A) $67.50. B) $270.00. C) $157.50. D) $135.00. E) $90.00.