Newland corporation borrowed from CIB Bank an amount of $10,000 on 1 April 2019. The...
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Newland corporation borrowed from CIB Bank an amount of $10,000 on 1 April 2019. The total loan to be re-paid on 1 April 2024. Newland company pays interest of 20% per year to CIB Bank according to the contract. At the beginning of 2020, Newland owed CIB a balance of $300 interest from the previous year 2019. During 2020, Newland paid CIB 80% from the $300 interest owed back from 2019. Required: Calculate the amount of Interest expense that will appear in the Income statement for 2019. Calculate the amount of Interest expense that will appear in the Income statement for 2020.
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