Monday, May 19, 2008

Interest Revenue on Note Receivable.

On October 1, 2006, Company A loaned $300,000 to Company B in exchange for a nine month, 11 percent note receivable. Company A's accounting period ends on January 1, 2007. What amount would be reported in Company A’s 2007 income statement as Interest Revenue?





Answer: $16,500


1 comment:

Anonymous said...

thank you for clearing this up, I have a similiar problem in my accounting class and could not get it. Only it is bonds sold for 600,000 at 10% for 20 years but the purchase was made in september1 to july1 semiannual payment ending dec 31.

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