Answer:
The answer is:
A: I=$76,67 MV=$4076,67
B: I=$293,75 MV=$10293,75
C: I=$138,125 MV=$6638,125
D: I=$36,75 MV=$936,75
Explanation:
Notes are often a key component of how a business finances its operations. For purposes of accounting, it's important to be able to calculate the maturity value of a note to know how much a business will have to pay or receive when the note comes due.
In general, notes are a form of short-term commercial financing. The maturity value is the amount of money that the company would receive when the note comes due.
When you know the principal amount, the rate, and the time, the amount of interest can be calculated by using the formula:
I = P*r*t
I= Total interest
P= principal
r= interest rate
t= time
To calculate the Maturity Value you need to sum the principal to the total interest accumulated over time.
Maturity Value= Principal + Interest
<u>In this exercise:</u>
<u>A:</u>
Principal: $4000 r=11,5% t=60 days
I=4000*0,115*(60/360)= $76,67
Maturity Value= 4000 + 76,67= $4076,67
<u>B:</u>
Principal: $10,000 r=11.75% t=90 days
I=10000*0,1175*(90/360)= $293,75
Maturity Value= 10000+ 293,75= $10293,75
<u>C:</u>
Principal= $6,500 r=12.75% time=60 days
I=6500*0,1275*(60/360)= $138,125
Maturity Value= 6500+ 138,125= $6638,125
<u>D:</u>
Principal= $900 r= 12.25% time=120 days
I=900*0,1225*(120/360)= $36,75
Maturity Value= 900+ 36,75= $936,75
