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34kurt
4 years ago
5

On November 1, Year 1, Noble Co borrowed $80,000 from South Bank and signed a 12% six month note payable, all due at maturity. T

he interest on this loan is stated separately. How much must Noble pay South Bank on May 1, Year 2, when the note matures?
a. $84,000
b. $89,600
c. $82,400
d. $80,000
Business
1 answer:
vlada-n [284]4 years ago
4 0

Answer: answer is not in the option.

Correst answer -Noble must pay South Bank on May 1, Year 2, when the note matures, $84,800

Explanation:

Interest accrued = Principal(amount borrowed) x rate x time

= $80,000 x 12 x 6/12

= $4,800

Amount to be paid on may 1 st the next year (year 2 )=Amount borrowed + interest accrued

= $80,000 +  $4,800 = $84,800

Noble must pay South Bank on May 1, Year 2, when the note matures the sum of $84,800

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