Question

Coronado industries accepts from gates stores a $6,800, 4-month, 8% note dated may 31 in settlement of gates' overdue account. the maturity date of the note is september 30. calculate the interest payable at maturity. (round answer to 0 decimal places,



e.g. $155.) interest payable at maturity $enter the interest payable at maturity in dollars rounded to 0 decimal places

Answer 1

Answer:

Interest =  $ 181.333

Explanation:

Coronado industries

$6,800, 4-month, 8% note

Interest= Principal of the interest * annual Interest rate* time in years

Interest= $ 6,800* 8% * 4/12

Interest = $ 6,800* 0.08 *1/3= $ 181.333

The rate of interest on a note is the rate charged for the use of the principal for one year.to simplify interest computation a year is commonly treated as having 360 days ( called the banker's rule).

Interest= Principal of the interest * annual Interest rate* time in years

Interest= $ 6,800* 8% * 4/12

Interest = $ 6,800* 0.08 *120/360= $ 181.333

Answer 2

Answer:

interest at maturity = $181

Explanation:

principal payable = $6800

time = 4 month = 0.3333 year

interest rate = 8% = 0.08

therefore the interest payable at maturity ( after 4 months )

= P*R*T

p = principal

R = INTEREST RATE

T = period

back to equation = $6800 * 0.08 * 0.3333 = $181.313 ≈ $181