On January 1, 2010, Northfield Corporation becomes delinquent on a $100,000, 14% note to the First National Bank, on which $16,651 of interest has accrued. On January 2, 2010, the bank agrees to restructure the note. It forgives the accrued interest, extends the repayment date to December 31, 2012, and reduces the interest rate to 10%.
Required:
Prepare a schedule for Northfield Corporation to compute the annual interest expense in regard to the preceding note for each year of the restructuring agreement.