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On September 1, 2020, Coronado Industries issued a note payable to Fidelity Bank in the amount of $2730000, bearing interest at 12%, and payable in three equal annual principal payments of $910000. On this date, the bank's prime rate was 13%. The first payment for interest and principal was made on September 1, 2021. At December 31, 2021, Coronado should record accrued interest payable of

Respuesta :

Zviko

Answer:

$327,600

Explanation:

Time value of Money techniques

We use the borrowing rate instead of the Prime rate to find the accrued interest payable.

PV = $2,730,000

i = 12 %

N = 3

PMT = - $910,000

P/yr = 1

FV = $0

Using the Financial calculator amortization function, interest will be $327,600

therefore,

At December 31, 2021, Coronado should record accrued interest payable of $327,600.

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