For the following promissory note, find the missing entry for days of interest o
ID: 2777620 • Letter: F
Question
For the following promissory note, find the missing entry for days of interest or maturity date (due date). Then compute the amount of interest due at maturity and the maturity value. For the given problem use a 360-day year. Round dollar amounts to the nearest cent.
For the following promissory note, find the missing entry for days of interest or maturity date (due date). Then compute the amount of interest due at maturity and the maturity value. For the given problem use a 360-day year. Round dollar amounts to the nearest cent.
Face Value Date of Note Days of Interest Maturity Date Rate Interest Amount Maturity Value $16,500 Mar. 24, 2013 __________ July 4, 2013 5.5% $_________ $________Explanation / Answer
Ist Part
1.Days of Interest
7 days remaining of March + 30 days of April + 31 days of May + 30 days of June + 4 days of july
Total days of interest = 102
2.Interest Amount
For 1 year or 360 days, the ineterest will be
= $ 16500 x 5.5%
= $ 907.5
For 102 days, the interest will be
= $ (907.5/360) x 102
= $ 257.125
3.Maturity Value
= Interest amount + Invested amount(Face value)
= 257.125 + 16500
= $ 16757.125
IInd Part
1.Days of Interest
3 days remaining of January + 28 days of February + 25 days of March
Total days of interest = 56
2.Interest Amount
For 1 year or 360 days, the ineterest will be
= $ 590 x 5.1%
= $ 30.09
For 56 days, the interest will be
= $ (30.09/360) x 56
= $ 4.68
3.Maturity Value
= Interest amount + Invested amount(Face value)
= 4.68 + 590
= $ 594.68
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.