Extract of pre-adjustment trial balance of Kumkani Traders as at 30 September 20.20 Debit R Credit R 200 000 ? 61 725 4450 195 000 50 000 345 060 9 500 6 780 Capital (1 October 20.19). Drawings... Inventory: Trading (1 October 20.19). Allowance for credit losses.. Mortgage: Ginsberg Bank Fixed deposit (at 7.5% per annum). Sales....... Carriage on purchases. Sales returns.. Rental income. Purchases..... Purchases returns. Depreciation.... Salaries and wages... Insurance expenses. Telephone expenses. Water and electricity. Credit losses....... 19 800 197 800 28 38 367 88 500 27 300 14 280 23 450 1 600 After a year-end inventory count, the value of trading inventory on hand was R123 450. Additional information (a) On 1 April 20.20 Kumkani Traders bought a factory building by means of a mortgage, from Ginsberg Bank, that bears interest at a rate of 10.05% per annum compounded annually. The loan is redeemable in 20 annual instalments of R22 980. The instalments are in arrears. Interest for the current year must still be provided for. (b) The fixed deposit investment of R50 000 was made on 1 April 20.20. Interest on this investment is paid annually. Which one of the following alternatives represent the correct amount that must be disclosed as interest on mortgage for the year ended 30 September 20.20? A. The interest expense amount will be R8 644. OB. The interest expense amount will be R17 288. . O C. The interest expense amount will be R Nil. . D. The interest expense amount will be R9 799. E. The interest expense amount will be R19 598