Keesha Co borrows 135000 cash on December 1 2017 by signing

Keesha Co. borrows $135,000 cash on December 1, 2017, by signing a 150-day, 9% note with a face value of $135,000 1. On what date does this note mature? (Assume that February has 28 days) April 25, 2018. O April 26, 2018. O Aprll 27, 2018. April 28, 2018. O April 30, 2018. 2. & 3. What is the amount of Interest expense In 2017 and 2018 from this note? (Use 360 days a year. Round final answers to the nearest whole dollar.) Total through maturity Interest Expense 2017 Expense 2018 Interest Principal Rate (%) Time Total interest

Solution

1. 30 April ,2018 , 150 days from 1 December,2017 that is 30 days of December 2017 , 31 days of January ,2018 , 28 days of February , 31 days of March and remaining of April 2018 .Therefore, 30th April,2018 will be maturity date

2 & 3 .

30 / 360 days

	Total through maturity	Interest expense 2017	Interest expense 2018
Principal	135000	135000	135000
Rate (%)	9%	9%	9%
Time	150 / 360 days	30 / 360 days	120 / 360 days
Total Interest	$5063	$1013	$4050