Your law firm regularly represents the First Bank of Alberta in its collection's matters. The First Bank has recently contacted you about a new file against TCB Memphis Grille Ltd. ["TCB"], a restaurant in Edmonton.

TCB entered into a loan agreement with the First Bank of Alberta on June 1, 2021, wherein it agreed to borrow $125,000 with interest at 12% per annum, compounded annually. The agreement stated that TCB would make payments of $2,780.56 on the first day of each month. These payments include accrued interest plus a portion of the principal. The agreement also included an acceleration clause, stating that if one payment is missed all remaining principal becomes due. Elvis Parsley, the majority shareholder of TCB, executed a personal guarantee on the loan the same day.

Monthly payments commenced on July 1, 2021. Payments were made on time for many months, but TCB has fallen behind. The last payment was made on May 1, 2022, with $98,585.87 still owing on the loan. Nothing has been paid since May 1, 2022. Your client has sent TCB and Parsley several letters demanding payment and is now calling Parsley on a daily basis. Parsley occasionally answers the phone. When he answered on August 3, 2022, he got agitated and insisted he'll pay once people eat at restaurants again. The representative from the First Bank replied that no one will ever want to eat at his lousy restaurant and that he'd better get his act together or he'll find himself eating at a soup kitchen instead.

How much interest will have accrued as of September 20, 2022

Answer rating: 100% (QA)

To calculate the interest accrued as of September 20 2022 we need to determine the number of days si... View the full answer