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13 June, 18:41

On February 1, 2021, Miter Corp. lends cash and accepts a $4,100 note receivable that offers 18% interest and is due in six months. How much interest revenue will Miter Corp. report during 2021

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  1. 13 June, 20:16
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    The interest revenue amounts to $369

    Explanation:

    The interest revenue for the following is computed as follows:

    Interest revenue = Note receivable * Percentage * Months / Total number of months

    where

    Note receivable amounts to $4,100

    Percentage is 18%

    Months is 6

    Total number of months 12

    Putting the values above:

    Interest revenue = $4,100 * 18% * 6/12

    Interest revenue = $738 * 6/12

    Interest revenue = $369

    Therefore, the amount of $369, is the interest revenue which Miter Corp will report during the year 2021
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