Asked by Anonymous
Euromart Tile Company borrowed $40,000 on April 6 for 66 days. The rate was 14% using the ordinary interest rate method. On day 25 of the loan, Euromart made a partial payment of $15,000, and on day 45 of the loan, Euromart made a second partial payment of $10,000. What was the new maturity value of the loan?
Answers
Answered by
Annie
I=PRT
I=40,000*.14*25/360=$388.89 (interest)
$15,000-388.89=$14,611.11 (amt. of partial payment left to reduce the principal)
40,000-14,611.11=$25,388.89 (adjusted principal balance)
$25,388.89*.14*20/360=197.47
10,000-197.47=9802.53
25,388.89-9802.53=15,586.36
15,586.36*.14*21/360=127.29
15,586.36-127.29=$15,713.65
Maturity Value of the loan is $15,713.65
I=40,000*.14*25/360=$388.89 (interest)
$15,000-388.89=$14,611.11 (amt. of partial payment left to reduce the principal)
40,000-14,611.11=$25,388.89 (adjusted principal balance)
$25,388.89*.14*20/360=197.47
10,000-197.47=9802.53
25,388.89-9802.53=15,586.36
15,586.36*.14*21/360=127.29
15,586.36-127.29=$15,713.65
Maturity Value of the loan is $15,713.65
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