Question

on august 1, 2022, laker bakery loaned $100,000 to a start-up food delivery service. the delivery service is required to repay the principal plus accrued interest on december 31, 2023. if the annual interest rate is 12%, what amount of interest income did laker bakery earn for the calendar year ended december 31, 2022 with respect to this loan?

Answer 1

Laker Bakery earned an interest income of $5,260.27 for the calendar year ended December 31, 2022 with respect to this loan.

Step-by-step explanation:

To calculate the amount of interest income earned by Laker Bakery for the calendar year ended December 31, 2022, we need to determine the interest earned from August 1, 2022, to December 31, 2022.

First, we calculate the number of days from August 1 to December 31, which is 152 days. Then, we calculate the interest using the simple interest formula:

Interest = Principal x Rate x Time

Interest = $100,000 x 0.12 x (152/365) = $5,260.27

Therefore, Laker Bakery earned an interest income of $5,260.27 for the calendar year ended December 31, 2022 with respect to this loan.