A Mount Dora startup expects to borrow $62,000 for one month on its line of credit at 8.1% annual interest. What one-month interest cost should be budgeted?
Correct Answer
C) $418.50
One-month interest equals principal multiplied by annual rate divided by 12.
Why This Is the Correct Answer
One-month interest equals principal multiplied by annual rate divided by 12.
Why the Other Options Are Wrong
Option A: $5,022.00 insurance evidence file
$5,022.00 insurance evidence file is above the supported result for startup borrowing cost; it likely adds an unsupported amount or compares the wrong financial base.
Option B: $5,166.67 banking setup log
$5,166.67 banking setup log is above the supported result for startup borrowing cost; it likely adds an unsupported amount or compares the wrong financial base.
Option D: $837.00 tax registration packet
$837.00 tax registration packet is above the supported result for startup borrowing cost; it likely adds an unsupported amount or compares the wrong financial base.
Memory Technique
Controller Estimates money test: bucket before math for startup borrowing cost.
Reference Hint
Open-book path: tab Contractor's Manual, 2025 to Startup financing and credit-line planning; verify the startup duty, registration, or financial setup before answering.
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