Shawn Bixby borrowed 17000.00 on a 120-day, 12% note. After 65 days, Shawn paid 2000.00 on the note. On day 89, Shawn paid an additional 4000.00. What is the final balance due? Determine total intrest and ending balance due by the U.S. Rule. Use ordinary intrest

Question

Shawn Bixby borrowed 17000.00 on a 120-day, 12% note.  After 65 days, Shawn paid 2000.00 on the note.  On day 89, Shawn paid an additional 4000.00.  What is the final balance due?  Determine total intrest and ending balance due by the U.S. Rule.  Use ordinary intrest

Reiny · Accepted Answer

Day 65: I = 17000*.12*65/360
= 368.33
So he owes 17368.33, at this time he pays off $2000 leaving him with a debt of
15368.33 at day 65

Day 89: another 24 days have passed
I = 15368.33*.12*24/360
= 122.95
so at this time he owes 15491.28, but pays off 4000 leaving with a balance on day 89 of 11491.28

It will be another 31 days till the note is due
I = 11491.28*.12*31/360
= 118.74

So at that time he owes 11610.02

The total interest paid is
368.33+122.95+118.74
= 610.02

BTW, I am in Canada, so I don't know what "US Rule" is. Tell me please

Scott · Answer

US rule is using 360 days and not 365