Roys checking account pays 1% interest monthly and has a $10 service fee. if roys balance last month was $2223, find the amount
2 answers:
Answer:
d) credit of 12.23 is the answer.
Step-by-step explanation:
To calculate the answer, let us first calculate the interest that Roys is eligible to receive from his bank.
We know the following details from the question :
Amount Deposited is : $2,223
Rate of interest is : 1% per month
Period of interest is : 1 month
Using the above details, we can put them into the formula of simple interest.
The formula for simple interest is as follows :
= Principal * Interest * time period
Therefore, the interest amount will be as follows :
= 2,223 * * 1
= 22.23
So, the interest to be received by Roys is 22.23 for 1 month.
Now, we need to reduce the amount of service charge from this interest to get the net amount to be received by Roys.
Net amount to be received by Roys is as follows :
= Interest amount calculated - Service Charge
= 22.23 - 10
= 12.23
So, it is clear that the net amount receivable by Roys is 12.23
From the perspective of the bank, the amount paid to the customer is called credit and the service charge taken from the customer is called debit. Here, the bank is paying 22.23 (credit) and taking the service charge of 10 (debit) which means the credit is more than the debit.
Therefore, we can simply cancel them out and credit the net amount of 12.23 to Roys.
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