Question

ompute total interest accrued for all of the following notes payable owed by Petry Company, as...

ompute total interest accrued for all of the following notes payable owed by Petry Company, as of December 31, 2019 (use a 365-day year).

Lender

Issuance Date

Principal

Coupon rate (%)

Term

Nissim

10/30/19

$20,000

11%

120 days

Klien

12/1/19

$15,000

8%

90 days

Bildersee

12/21/19

$17,000

10%

60 days

Homework Answers

Answer #1

Calculation of Total Interest Accrued on December 31, 2019

Particulars Amount
Nissim 373.70
Klien 98.63
Bildersee 46.58
Total Interest Owed by Petry 518.91

Notes:-

For Nissim

Interest due on Dec 31 2019 = 20,000 * 11/100 * 62/365

= $ 373.70

Number of Days = 62 Days (1 Day of October + 30 Days of November + 31 Days of December)

For Klien

Interest due on Dec 31,2019 = 15,000 * 8/100 * 30/365

= $ 98.63

Number of Days = 30 Days of December (Between 02/12/2019 to 31/12/2019)

For Bildersee

Interest due on Dec 31,2019 = 17,000 * 10/100 * 10/365

= $ 46.58

Number of Days = 10 Days of December (22/12/2019 to 31/12/2019)

In Calculation of Number of Days between nite issuance date and Dec 31,2019 for calculating Interest the date off issuance of nite should be excluded.

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