Exam 11: Simple Interest and Simple Discount

On June 1, Donaldson's Trucking accepts a $3000 note in settlement of a bill. The note is for 180 days at 10% interest. Donaldson sells the note at a 11% discount rate on July 22. Find the proceeds.

Twin City Freezer accepts a note with face value of $5150 on June 4. The note is for 270 days at 10% interest. The note is discounted on July 23 at 12%. Find the proceeds.

In a non-interest bearing note, the maturity value is the same as the:

Using the ordinary interest exact time method, a year is assumed to have 360 days.

Find the exact interest on a loan of $93,000 at 12% annually for 137 days.

When you use exact time, the duration of a loan that is dated June 8 and is due November 23 is 166 days.

Find the interest paid on a loan of $3946 for 5 months at a simple interest rate of 12% per year.

When calculating ordinary interest, the denominator of the time fraction is 360 days.

Find the ordinary interest on a loan of $2780 at 7% annually for 316 days.

Find the maturity value of a loan of $6787 after 4 months. The loan carries a simple interest rate of 14% per year.

The total amount of money due at the end of a loan period is called the maturity value.

The maker of a promissory note is the borrower of the money.

Simple interest is often used when a loan is repaid in a lump sum.

February 11 is the due date of a 100-day (exact time) loan dated November 3.