exercise 9-21 (algo) dishonoring a note lo p4\nfollowing are transactions for ridge company.\nmarch 21…
exercise 9-21 (algo) dishonoring a note lo p4\nfollowing are transactions for ridge company.\nmarch 21 accepted a $5,900, 180 - day, 12% note from tamara jackson in granting a time extension on account receivable.\nseptember 17 jackson dishonored her note.\ndecember 31 after trying several times to collect, ridge company wrote off jackson’s account against doubtful accounts.\ncomplete the table to calculate the interest amounts at september 17 and use the calculated value to prepare\nnote: do not round intermediate calculations. round your final answers to nearest whole dollar. use 360 days.\ncomplete this question by entering your answers in the tabs below.\ninterest amounts general journal\ncomplete the table to calculate the interest amounts at september 17.\ninterest calculated through maturity date\nprincipal\nrate (%)\ntime\ntotal interest
Answer
Explanation:
Step1: Identify principal amount
Principal = $5900
Step2: Identify interest rate
Rate = 12% or 0.12 in decimal form
Step3: Calculate time in years
The note is 180 - day. Using 360 - day year, Time = $\frac{180}{360}= 0.5$ years
Step4: Calculate total interest
Total Interest = Principal×Rate×Time = $5900\times0.12\times0.5 = 354$
Answer:
| Interest calculated through maturity date | |
|---|---|
| Principal | $5900 |
| Rate (%) | 12 |
| Time | 0.5 years |
| Total Interest | $354 |