On November 30, ABC corporation borrows $79,000 from the bank by signing a 60 day, 8%...

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On November 30, ABC corporation borrows $79,000 from the bank by signing a 60 day, 8% note agreement. Round values to 2 decim

business accounting

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Answer 1

Answer #1

Journal

12/31	Interest expense	536.77
	Interest payable		536.77

Interest accrued on December 31 = 79,000 x 8% x 31/365

= $536.77

Note: If it is assumed that the year has 360 days, interest on December 31, will be calculated as under:

Interest accrued on December 31 = 79,000 x 8% x 31/360

= $544.22

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Answer 2

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