Nirwana dealers has been in business for two years since 1 January 20.1. You are presented with their final trial balance at 31 December 20.2

Mortgage bond R75 000

Interest on mortgage bond R10 575

The mortgage bond was registered on 1 January 20.1 when Nirwana dealers purchased the property, paying a 25% deposit and raising a mortgage bond for the remaining 75% (R90 000) of the value of the property.

Repayments are made off the capital amount of the bond at a rate of R5 000 every six months, commencing 30 June 20.1.

Make provision for the full year's interest on the bond. The bond rate was increased by 2% to 20% p.a. on 30 September 20.2.

Kindly assist with the above. Please show all calculations and explanation. Thanking you in advance