On September 1, Year 1, Able Company purchased a building from Regal Corporation by paying $ 380,000 cash and issuing a one- year note payable for the balance of the purchase price. Interest on the note is stated at an annual rate of 12% and is paid at maturity. In its December 31, Year 1, balance sheet, Able correctly presented the note and interest payable as follows: Interest payable $15, 200 Notes payable, 12%, due September 1, Year 2 $380,000 What is the amount of the interest expense Able will recognize on this note in Year 2? Multiple Choice $15,200 $26, 600 $ 30,400 $45,600
On September 1, Year 1, Able Company purchased a building from Regal Corporation by paying $ 380,000 cash and issuing a one- year note payable for the balance of the purchase price. Interest on the note is stated at an annual rate of 12% and is paid at maturity. In its December 31, Year 1, balance sheet, Able correctly presented the note and interest payable as follows: Interest payable $15, 200 Notes payable, 12%, due September 1, Year 2 $380,000 What is the amount of the interest expense Able will recognize on this note in Year 2? Multiple Choice $15,200 $26, 600 $ 30,400 $45,600
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter6: Cash And Receivables
Section: Chapter Questions
Problem 14RE: On June 1, Phillips Corporation sold, with recourse, a note receivable from a customer to a bank....
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On September 1, Year 1, Able Company purchased a building from Regal Corporation by paying $ 380,000 cash and issuing a one- year note payable for the balance of the purchase price. Interest on the note is stated at an annual rate of 12% and is paid at maturity. In its December 31, Year 1, balance sheet, Able correctly presented the note and interest payable as follows: Interest payable $15, 200 Notes payable, 12%, due September 1, Year 2 $380,000 What is the amount of the interest expense Able will recognize on this note in Year 2? Multiple Choice $15,200 $26, 600 $ 30,400 $45,600
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