Hi Im currently studying Senior Bookkeeping - Financial statements, (Part-Time) and have run into a question i cant answer.
The Textbook doesnt seem to have any examples regarding it either. The question i have is taken from a Sample Assessment similar to the one
i will receive in my examination. So i need to understand how they came to the solution, i have approached 2 accountants and a lecturer, unfortunately they couldnt help me either. so here i am....
Provide for the Interest on the Mortgage Loan. Interest is calculated at 12% per Annum. The liability was repaid (redeemed) by
R50 000 on 1 June 2006. There we no additional loans or repayments during the financial year. But twelve end-of month instalments of R1650
each are due to be repaid on the loan starting at the end of February 2007.
The Mortgage loan: R180000
(It doesnt say when the loan was initiated but Land & Buildings is R187500).
Under the Proposed Solution
Incrued Expense R23 600
My Question is how did they come to that solution?