Question

On July 1, 2015, Allen Company signed a $100,000, one-year, 6 percent note payable. The principal and interest will be paid on June 30, 2016. How much interest expense should be reported on the income statement for the year ended December 31, 2015?a. $ 6,000b. $ 3,000c. $1,500d. $ 0

Answer 1

b. $ 3,000

Step-by-step explanation:

Interest expense = $100,000*0,06*6/12

=$3000

Therefore, the interest expense that should be reported on the income statement for the year ended December 31, 2015 is $3000