Question

For each of the following notes receivable, compute the amount of interest revenue earned during 2020. Use a 365 day year or base your calculations on the number of months, depending on how the interest period is stated, and round only your answer to the nearest dollar Note 1 Note 2 Note 3 Note 4 Principal interest Rate $360,000 12% 46,000 30,000 15% 116,000 10% Interest Period During 2020 8 months 30 days 90 days 6 months Compute the amount of interest revenue earned during 2020 (Use a 365-day year or base your calculations on the number of months, depending on how the interest period is stated, and round your final answer to the nearest dollar.) Note 1 Note 2 Note 3 Note 4

Answer 1

Solution ;

Interest revenue earned during 2020

Note 1          $ 28800

Note 2          $ 416

Note 3          $ 1110

Note 4          $ 5800

Working note

Note 1 = $360,000 * 12% *8/12 = 28800

Note 2 = $46000 * 11% * 30/365 = 416

Note 3 = $30,000 * 15% * 90/365 = 1110

Note 4 = $116000 * 10% * 6/12 = 5800