mpany is required ‭ maintain a compensating  balance of P50,000 in a checking account. The company's checking account earns interest  at an annual rate of 2%. Ordinarily the company  maintains  balance of P25,000  in its checking account  for transaction purposes. What is the effective interest rate of the loan?

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A:

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A: Following are the requisite Journal Entries

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Q: months after the given mat

A: Given as,

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