Sherman Air Charter signed a four-month note payable in the amount of $8,000 on September 1. The note requires interest at an annual rate of 9%. The amount of interest to be accrued at the end of September is
A) $240.
B) $60.
C) $720.
D) $80.

Question

Quizplus · Accepted Answer

To calculate the interest accrued at the end of September, we need to find the monthly interest rate first.

Monthly interest rate = Annual interest rate / 12 = 9% / 12 = 0.75%

Next, we need to find the time period for which the interest is being calculated, which is one month (September).

Using these values, we can calculate the interest accrued:

Interest = Principal x Monthly interest rate x Time period

Interest = $8,000 x 0.0075 x 1

Interest = $60

Therefore, the answer is B, $60.

Sherman Air Charter Signed a Four-Month Note Payable in the Amount