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On December 31, 2021, the credit quality of S Co deteriorated significantly due to poor market conditions but S Co did not default on the

On December 31, 2021, the credit quality of S Co deteriorated significantly due to poor market conditions but S Co did not default on the interest payment. The probability of default during the next 12 months to December 31, 2022 was 5% and the probability of default during the remaining lifetime to December 31, 2024 was 25%. Apply discounting at 7%.

(c) What is the interest revenue to be reported for 2021?

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