Question

A 90 day, 12% note for $20,000 dated July 1 is received from a customer. What is the maturity value of the note

Answer 1

Answer:maturity value of the note= $20,600

Explanation:

Interest = Principal x Rate x period /time

Assuming 360 days = 1 year  

Interest = 20000 x 12% x 90/360

Interest = $600

Maturity value = Principal amount + interest accrued on due date

$20000 + $600 = $20,600.