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On May 1, 2020, Janine Company secured a loan from NorthSouth Bank, P1,250,000, with 1% monthly interest. As a security, all (P2,500,000) of the accounts receivable of the entity was pledged to the bank. Collections in May amounted to P700,000, which was remitted to the bank at the end of the month in the payment of the interest and partial payment of the principal. During June, the entity collected 850,000 of the receivables and settled the loan with the Bank.
Problem 1: How much is the total interest expense incurred in 2020?
Problem 2: How much was the final payment to the bank?
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