mathxl.com Do Homework-Max Ma Acct 1 Spring 2018 22908 Homework: Chapter 5 Homew
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mathxl.com Do Homework-Max Ma Acct 1 Spring 2018 22908 Homework: Chapter 5 Homework Score: 0 of 1 pt 5 of 10 (6 complete) S5-12 (book/static) 1. Compute the amount of interest during 2016, 2017, and 2018 for the folowing note recevable On May 31,2016. Charter Bank len 2. Which party has a(o): (a) note receivable? (tb) note payable? (e)interest revenue? (d) interest expense? 3. How much in total would Charter Bank colloct &Laurie; Walker paid off the note early--say, on November 30, 2016 . Compute the amount of interest during 2016, 2017, and 2018 for the following note receivable: On May 31, 2016 Let's calculate interest for 2016, 2017, and 2018. (Round the interast to the nearest whole dollar) , Charter Bank lent $220,000 to Laurie Walker on a two On a two-year, 10% note. YearAmount 2016 2017 2018Explanation / Answer
Date of Note = 31 May 2016
Rate of Interest = 10%
Days in year = 365 Days
End of financial Year = 31st December each year.
Duration of Note = 2 Years
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Answer (1)
Due Date = May 31, 2018
Days due in 2016 = (30+31+31+30+31+30+31) = 214 Days
Days due in 2017 = 365 Days
Days due in 2018 = (31+28+31+30+31) = 151 Days
Total Interest for two years = 220000 x 10% x 730 / 365
= 22000 x 730 / 365
= $ 44000
Maturity Value will be = 220000 + 44000 = $264000
Interest for year 2016 = 220000 x 10% x 214 / 365 = 22000 x 214 / 365 = $ 12899
Interest for year 2017 = 220000 x 10% x 365 /365 = 22000 x 365 / 365 = $ 22000
Interest for year 2018 = 220000 x 10% x 151 / 365 = 22000 x 151 / 365 = $9101
Total interest for two years = (12899 + 22000 + 9101) = $44000
Answer (2)
Answer (3)
Total Amount (Maturity Value) if not paid by Laurie early as on November 30, 2016
Maturity Date = November 30, 2016
Days Due = (30+31+31+30+31+30 = 183 Days
Maturity Value = Principal + Interest
= 220000 + (220000 x 10% x 183 / 365)
= 220000 + (220000 x 183 /365)
= 220000 + 11030
= $231030
So Charter bank will collect $231030 as on November 30, 2016
A. Note Receivable Charter Bank B. Note Payable Laurie Walker C. Interest Revenue Charter Bank D. Interest Expenses Laurie WalkerRelated Questions
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