On September 1,2010,Donna Equipment Signed a One-Year,8% Interest-Bearing Note Payable

Multiple Choice

On September 1,2010,Donna Equipment signed a one-year,8% interest-bearing note payable for $50,000.Assuming that Donna Equipment maintains its books on a calendar year basis,how much interest expense that should be reported in the 2011 income statement?

A) $2,667
B) $4,000
C) $1,333
D) $3,000