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Finance officials for the City of Sansville determine that a significant revenue shortfall will occur in its General Fund during the year. To temporarily make

Finance officials for the City of Sansville determine that a significant revenue shortfall will

occur in its General Fund during the year. To temporarily make up for the shortfall, city officials

borrow $500,000 using a Tax Anticipation Note (TAN) on June 30, 2021 that is due to be repaid

on March 31, 2022 with interest of 2 percent per annum. For what amount should the city debit

the Expendituresinterest account at its fiscal year-end on December 31, 2021?

a. $0

b. $5,000

c. $7,500

d. $10,000

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