S Environmental provides cost-effective solutions for managing regulatory requirements and environmental needs specific to the airline industry. Assume that on July 1, 2012, the company issues a one-year note for the amount of $5 million. Interest is payable at maturity.
Required:
Determine the amount of interest expense that should be recorded in a year-end adjusting entry under each of the following independent assumptions:
Interest Rate _________________ Fiscal Year-End
1. 12% ................................ December 31
2. 10% ................................ September 30
3. 9% .................................. October 31
4. 6% .................................. January 31