Question

What is the interest revenue that Richmond would report in 2011 and 2012, respectively, for a $9,000 loan with a 12% interest rate?

a) $1,080 in 2011 and $0 in 2012
b) $1,080 in 2011 and $1,080 in 2012
c) $900 in 2011 and $900 in 2012
d) $0 in 2011 and $1,080 in 2012

Answer 1

The interest revenue in 2011 and 2012 for a $9,000 loan with a 12% interest rate is $1,080.the correct answer is (b) $1,080 in 2011 and $1,080 in 2012.

Step-by-step explanation:

In this question, Richmond has a $9,000 loan with a 12% interest rate. To calculate the interest revenue for each year, we can multiply the loan amount by the interest rate. In 2011, Richmond would report $9000 * 0.12 = $1,080 in interest revenue. In 2012, the loan would still be outstanding, so Richmond would report the same interest revenue of $1,080.

Therefore, the correct answer is (b) $1,080 in 2011 and $1,080 in 2012.