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Posted on Jul 26, 2024

On September 1, Year 1, West Company borrowed $30,000 from Valley Bank. West agreed to pay interest annually at the rate of 5% per year.

On September 1, Year 1, West Company borrowed $30,000 from Valley Bank. West agreed to pay interest annually at the rate of 5% per year. The note issued by West carried an 18-month term. West Company has a calendar year-end. What is the amount of interest expense that will be reported on West's income statement for Year 1?

Multiple Choice

$150

$500

$-0-

$375

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