A 90-day, 8% note for $10,000 dated May 1 is received from a customer on account.The maturity value of the note is (Assume 360 days in a year):
A) $10,000.
B) $10,800.
C) $10,200.
D) $9,800.

Question

Quizplus · Accepted Answer

The maturity value of the note is calculated by adding the interest earned to the principal amount. Interest = Principal × Rate × Time = $10,000 × 8% × (90/360) = $200. Therefore, the maturity value = Principal + Interest = $10,000 + $200 = $10,200.

A 90-Day, 8% Note for $10,000 Dated May 1 Is