31 July 2017,

5. The company's short term and long term loans are charged interest at the rate of 10% p.a. paid quarterly, but accrued daily. Interest to be accrued on both short term and long term loans using the following formula:

(Interest Accrual = Loan Balance * Interest Rate * days in month/ days in year). Assume that interest accrued payable loan balance is $1850.

Please explain both short term and long term interest accrual solutions & how to record both of these entries into a journal.