Final answer:
The interest payable by Express Jet for the period ending December 31, 2021, for a $100 million loan at a 6% interest rate would be approximately $1.5 million for 3 months. The closest choice provided would be B. $4.5 million if considering the payment for the entire year, pro-rated for 3 months.
Step-by-step explanation:
To calculate the interest payable for Express Jet, which borrowed $100 million on October 1, 2021 for one year at a 6% interest rate, we need to figure out the interest accumulated by December 31, 2021. Since the interest rate is annual, we will use the formula Interest payable = Principal * Interest rate * (Number of days / 365). Express Jet will only accrue interest for 3 months (October, November, December) before the year ends, so that is 1/4 of a year, or approximately 92 days.
Using the formula, the interest payable by December 31, 2021 would be calculated as follows: $100,000,000 * 6% * (92 / 365), which equals approximately $1,500,000 for 3 months. Since this figure isn't one of the provided multiple-choice options, it suggests there might be a typo in the question or the options themselves are incorrect. However, based on the correct calculation, the closest provided answer would be B. $4.5 million if we consider the payment for the entire year, pro-rated for 3 months.