On October 1,2018,Stripes Inc

question 119

Multiple Choice

On October 1,2018,Stripes Inc.lends $100,000 to another company and accepts a 24-month,6% note.What is the amount of interest revenue Stripes will report in its 2019 income statement?

• A)$0.
• B)$1,500.
• C)$4,500.
• D)$6,000.

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Definitions:

Graphical Approach

A method of solving problems or representing data using charts, graphs, or diagrams.

CVP Analysis

Short for Cost-Volume-Profit Analysis, a tool used to determine how changes in cost and volume affect a company's operating income and net income.

Variable Costs

Variable Costs are costs that vary directly with the level of production or sales volume.

Fixed Costs

Expenses that do not change with the level of production or sales, such as rent, salaries, and insurance premiums, which are constant regardless of business activity levels.