Question

Compute interest and find the maturity date for the following notes. (Use 360 days for calculation.) Date of Note Interest Rate (%) Principal Terms Interest Maturity Date a. June 10 $43,200 10% 60 days $ b. July 14 $36,000 11% 90 days $ C. April 27 $18,000 12% 75 days $ $ e Textbook and Media

Answer 1

Interest = Principal * Rate * Time

Assumption : No. of days = 360 days

a) Interest = $ 43200*10%*60/360 = $ 720

Maturity = Days in June (30-10 = 20) + Days in July = 31+ Remaining days after June and July (69-20-31) = 9th August.

b) Interest = $ 36000*11%*90/360 = $ 990

  Maturity = Days in July (31-14 = 17) + Days in August = 31+ Remaining days after September = 30+ Remaining days after Jult,August and September (90 - 17 -31 -30) = 12th October.

c) Interest = $18000*12%*75/360 = $450

Maturity = Days in April (30 - 27 = 3) + Days in May = 31 + Days in June = 30+ Remaining days after April, May and June (75 - 3 - 31 - 30) = 11th July.