On September 1, 2013, Sharp Corp. lent $2,400 to Marla Smith on a 6-month 10% promissory note. The amount of interest to be accrued on December 31 will be:

Name: On September 1, 2013, Sharp Corp. lent $2,400 to Marla Smith on a 6-month 10% promissory note. The amount of interest to be accrued on December 31 will be:
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Question

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The interest on the note for 4 months (September 1 to December 31) is calculated as follows: Interest = Principal × Rate × Time = $2,400 × 10% × (4/12) = $80.