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Home > Business & Careers > Accounting   »   accrued interest revenue

 
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Old Apr 16, 2007, 08:42 AM
dwatkins1025
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accrued interest revenue

home work question

comp holds a 90 day receivable of 10,000 from a customer. The note is dated oct 31 and has a 12% interest rate. your comp year ends on dec 31. how much interest revenue do you accrue on dec 31?

I said 10,000X.12= 1200*2/12=200 my answer is 200, am i correct

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Old Apr 16, 2007, 08:47 AM   #2  
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Yes, I believe you are. The note was dated at the end of October and only 2 months passed in the question. The 12% is annual interest and only 2 months passed so only 2% interest is incurred. So your calculations are correct.
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Old Apr 16, 2007, 01:02 PM   #3  
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200, correct
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Old Oct 11, 2008, 12:02 AM   #4  
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the note is good for 90 days only.
10,000 x 12% = 1,200 x 90 / 360 = 300.00
it's 2 monhts passed, so interest accrued computation will be: 300 X 60 / 90 = 200.
Banker's rule is using 360 days.
You're right!
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