LO8 On July 1, 2010, Andaria borrows $30,000 from the First Financial Bank. The loan is for

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LO8 On July 1, 2010, Andaria borrows $30,000 from the First Financial Bank. The loan is for 1 year at an annual interest rate of 10%. How much interest can Andaria deduct under each of the following situations?

a. The bank deducts the interest from the loan proceeds.

b. The $30,000 loan proceeds are due at the end of the loan, but Andaria pays interest on the loan each month.

c. The interest and loan proceeds are due June 30, 2011.

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