Mrs. Franklin has two mortgage loans at First National Bank on which she makes monthly payments. On Loan A she made 13 payments last year, mailing the last payment on December 28. It was received the afternoon of January 2 and credited on January 3. The amount of interest paid on Loan A in the first 12 payments was $1,000. There was $155 of interest on the 13th payment. On Loan B, she made 12 payments; each contained interest accrued to the fourth day of the month. The last payment was mailed on December 19 and was received and credited on December 23. The last payment contained interest accrued to January 4. The total interest paid on Loan B was $2,000, of which $100 accrued between January 1 and January 4 of the next year. How much interest must First National Bank report?

Question

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For Loan A, only the interest from the first 12 payments ($1,000) is reported for the year, as the 13th payment was credited in the next year. For Loan B, the interest accrued in the year is $2,000, excluding the $100 that accrued in the next year.

Mrs Franklin Has Two Mortgage Loans at First National Bank