Step 1: Understand the Terms of the Loan

The business has taken a loan of $210,000 at an interest rate of 10% per annum. The interest is payable semi-annually, which means it is paid twice a year - on 30 June and 31 December.

Step 2: Calculate the Semi-Annual Interest Rate

Since the interest is paid twice a year, we need to divide the annual interest rate by 2 to get the semi-annual interest rate. So, 10% divided by 2 equals 5%.

Step 3: Calculate the Interest Payable

To calculate the interest payable for the period ending 30 June 2023, multiply the loan amount by the semi-annual interest rate.

So, $210,000 * 5/100 = $10,500.

Step 4: Determine the Interest Payable Account Balance

The interest payable account balance at 30 June 2023 would be $10,500. This is because the interest for the period has been calculated but not yet paid (it is paid on 30 June and 31 December).

So, the interest payable at 30 June 2023 is $10,500.

Question

Step 1: Understand the Terms of the Loan

The business has taken a loan of $210,000 at an interest rate of 10% per annum. The interest is payable semi-annually, which means it is paid twice a year - on 30 June and 31 December.

Step 2: Calculate the Semi-Annual Interest Rate

Since the interest is paid twice a year, we need to divide the annual interest rate by 2 to get the semi-annual interest rate. So, 10% divided by 2 equals 5%.

Step 3: Calculate the Interest Payable

To calculate the interest payable for the period ending 30 June 2023, multiply the loan amount by the semi-annual interest rate.

So, $210,000 * 5/100 = $10,500.

Step 4: Determine the Interest Payable Account Balance

The interest payable account balance at 30 June 2023 would be $10,500. This is because the interest for the period has been calculated but not yet paid (it is paid on 30 June and 31 December).

So, the interest payable at 30 June 2023 is $10,500.

Knowee AI · Accepted Answer

Step 1: Understand the Terms of the Loan

The business has taken a loan of $210,000 at an interest rate of 10% per annum. The interest is payable semi-annually, which means it is paid twice a year - on 30 June and 31 December.

Step 2: Calculate the Semi-Annual Interest Rate

Since the interest is paid twice a year, we need to divide the annual interest rate by 2 to get the semi-annual interest rate. So, 10% divided by 2 equals 5%.

Step 3: Calculate the Interest Payable

To calculate the interest payable for the period ending 30 June 2023, multiply the loan amount by the semi-annual interest rate.

So, $210,000 * 5/100 = $10,500.

Step 4: Determine the Interest Payable Account Balance

The interest payable account balance at 30 June 2023 would be $10,500. This is because the interest for the period has been calculated but not yet paid (it is paid on 30 June and 31 December).

So, the interest payable at 30 June 2023 is $10,500.

A business receives $210,000 from a bank loan on the balance date of 31 December 2022. The loan has interest payable of 10% per annum and interest is paid twice a year on 30 June and 31 December. What is the interest payable account balance at 30 June 2023?

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