Question

Camp elim obtains a $125,000, 6%, five-year loan for a new camp bus on january 1, 2018. what amount will be recorded for interest expense for the first payment on january 31, 2018?

Answer 1

The amount that will be recorded for interest expense for the first payment on January 31, 2018 is $625. Interest expense is type of return which paid by the debtor in this case, Camp Elim for its $125,000 loan for the bus. To get the amount you must calculate 6% of the loan principal and then divided by 12, which is the total month of a year.

Answer 2

Answer:

$625

Explanation:

camp elin have to pay $625 for the period.

$simple interest = \frac{PRT}{100}$

$simple interest = \frac{125000*6*1}{100*12}$ = 625

simple interest : Easy interest is a fast and easy way to calculate interest charges on a loan. Simple interest is measured by the calculation of the principal's annual interest rate by the number of days among transactions that pass.