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Question
On July 8, Jones Inc. issued an $80,000, 6%, 120-day note payable to Miller Company. Assume that the fiscal year of Jones ends on July 31. Using the 360-day year, what is the amount of interest expense recognized by Jones in the current fiscal year, rounded to the nearest dollar?
a. $700
b. $4,200
c. $307
d. $1,400
Answer
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