Question

In calculating the bank discount when discounting an interest bearing note, which one of the following is not used in calculation? A. Bank discount rate
B. Maturity value
C. Principal proceeds
D. Discount period

Answer 1

In calculating the bank discount when discounting an interest bearing note, the one that is not used in calculation is: D. Discount period

Here is the equation that used in interest bearing note:
The Principle proceeds + bank discount = Maturity Value

Discount period only determines the amount of time vendor willing to pay for a product in cash.

Answer 2

The correct choice is "C. Principal Proceeds".  This answer is 100% correct