How does CPF calculate the monthly interest of 2.5% which is credited annually?

Minimum balance each month throughout the year and then credited at end of the year.

So if start with $0 and there is an addition of $1000 each month, then interest would be

($0 (Jan) + $1000 (Feb) + $2000 (Mar) + ... + $11000 (Dec)) / 12

• 2.5%

=$137.50