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majestico majestico
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6 years ago
Chase Hunford negotiated a $50,000 bank loan for 210 days at a bank rate of 12%. The bank deducted the interest in advance.
Required (show your calculations):
a) Calculate the amount of interest charged by the bank.
b) Calculate the amount of cash Chase received from the bank.
c) Calculate the effective interest rate charged by the bank.
d) Prepare Chase's journal entry for the transaction.
Textbook 
College Accounting: A Practical Approach

College Accounting: A Practical Approach


Edition: 13th
Author:
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LaffioLaffio
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6 years ago
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More solutions for this book are available here
a)   $50,000 × .12 × 210/360 = $3,500
b)   $50,000 - $3,500 = $46,500
c)   ($50,000 × 0.12)/$46,500 = 12.9%.
d)   Cash   46,500
   Discount on Note Payable   3,500
      Notes Payable      50,000
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majestico Author
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6 years ago
Good timing, thanks!
gma_of_7
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Yesterday
Thanks
alpheratz
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2 hours ago
Thank you, thank you, thank you!
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