Accounting Online Program Certification Practice Test

How much interest are Jonquil and Fred entitled to receive together for their capital and loan for the year ended 31 December 20X4?

1. £625

2. £750

3. £500

4. £800

The correct answer is: £625

To determine the total interest that Jonquil and Fred are entitled to receive for their capital and loan, it is essential to know the specifics regarding the rates of interest and the amounts of capital or loans involved. Typically, interest calculations involve applying a specified interest rate to the principal amount, which could be the total amount of capital invested by Jonquil and Fred, or it could relate to any loans they have taken. The figures used in the calculation might typically consider how long the funds were held, as well as the rates set. If the correct answer is £625, it reflects a calculated total based on the rates applied to their respective contributions. For example, if Jonquil’s capital of a certain amount is entitled to a particular interest rate, and Fred’s loan operated under a different scheme, combining their interests would lead to the total of £625. Considering the surrounding options, the figures suggest that the interest calculations were specifically tailored to reflect their financial agreement, accounting for both Jonquil's investment capital and Fred's loan arrangement. Thus, the result of £625 as a combined figure indicates an accurate calculation based on the parameters of their investments. Understanding the calculation methodology, such as identifying the core principal amounts and interest rates applied, ensures proper comprehension of