On May 15, Wild Quest Clothiers borrowed some money on a 4-month note to provide cash during the slow season of the year. The interest rate on the note was 8%. At the time the note was due, the amount of interest owed was $480.

a.Assume the amount borrowed was $18,400. What was the interest rate if the amount of interest owed was $552?

b.Prepare the entry for the initial borrowing and the repayment for the facts in part (a). (Credit account titles are automatically indented when amount is entered. Do not indent manually.)