Schubert Manufacturing Borrows from the Bank at 8% with a .30

question 169

Multiple Choice

Schubert Manufacturing borrows from the bank at 8% with a .30% commitment fee on any unused funds. The company borrowed $4 million last month with another $6 million available on their revolving line of credit.   Fifteen days into the new month the company borrowed another $2 million.   What is the firm's interest expense for the month? Assume a 30 day month. ​

• A)$35,500​
• B)$33,500​
• C)$35,000​
• D)$34,000​

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Definitions:

Adjusted Trial Balance

A list of all accounts and their balances after adjustments are made for accruals, deferrals, and errors to prepare for financial statement generation.

Net Income

The total profit of a company after all expenses, including taxes and operating costs, have been deducted from total revenue.

Service Revenue

Income earned by a company for the services it has provided to its customers.

Common Stock

Represents ownership shares in a corporation, giving holders a claim on part of the company's profits and assets.