A six-month note receivable for $8,000 at 13%, dated October 1, 2020, has accrued interest revenue of ________ as of December 31, 2020. (Round any intermediate calculations to two decimal places, and your final answer to the nearest dollar.)

Question

Quizplus · Accepted Answer

To calculate the accrued interest revenue, we need to find out the time period for which interest has accrued, i.e., from October 1 to December 31, which is 3 months.

Using the simple interest formula,

Interest = (Principal * Rate * Time) / 12

where Principal = $8,000, Rate = 13%, and Time = 3 months

Interest = (8,000 * 13% * 3) / 12 = $260

Therefore, the accrued interest revenue as of December 31, 2020, is $260. So, the best choice is option C.

A Six-Month Note Receivable for $8,000 at 13%, Dated October