exercise 11-4 (algo) accounting for note payable lo p1\nsylvestor systems borrows $58,000 cash on may 15 by…
exercise 11-4 (algo) accounting for note payable lo p1\nsylvestor systems borrows $58,000 cash on may 15 by signing a 60 - day, 6%, $58,000 note.\ncomplete this question by entering your answers in the tabs below.\nrequired 1 required 2a required 2b interest at maturity required 2b general journal\nfirst, complete the table below to calculate the interest expense at maturity.\nnote: use 360 days a year. round final answers to the nearest whole dollar.\ninterest at maturity\nprincipal\nrate (%)\ntime\ntotal interest
Answer
Explanation:
Step1: Identify principal amount
The principal amount (P) is the amount borrowed, which is $58,000. $P = 58000$
Step2: Identify annual interest rate
The annual interest rate (r) is 6% or 0.06 in decimal form. $r=0.06$
Step3: Identify time period
The time (t) is 60 - day note. Using 360 days a year, $t=\frac{60}{360}$
Step4: Calculate total interest
Use the simple - interest formula $I = P\times r\times t$. $I=58000\times0.06\times\frac{60}{360}$ $I = 58000\times0.06\times\frac{1}{6}$ $I = 580$
Answer:
| Interest at Maturity | |
|---|---|
| Principal | $58,000$ |
| Rate (%) | 6 |
| Time | $\frac{60}{360}$ |
| Total interest | $580$ |