A partial payment is made on the date(s) indicated. Use the United States Rule to determine the balance due on the note at the date of maturity. (The Effective Date is the date the note was written.) Assume the year is not a leap year.
-$$\begin{array} { l l l l c l }
\hline & & \text { Effective } & \text { Maturity } & \text { Partial } & \text { Payment } \
\text { Principal } & \text { Rate } & \text { Date } & \text { Date } & \text { Amount } & \text { Date } \
\hline \$ 500 & 6 \% & \text { August 8 } & \text { February 6 } & \$ 257 & \text { December 2 } \
\hline
\end{array}$$
A) $251.74
B) $255.45
C) $255.70
D) $245.67

Question

A partial payment is made on the date(s) indicated. Use the United States Rule to determine the balance due on the note at the date of maturity. (The Effective Date is the date the note was written.) Assume the year is not a leap year.
-$$\begin{array} { l l l l c l } 
\hline & & \text { Effective } & \text { Maturity } & \text { Partial } & \text { Payment } \
\text { Principal } & \text { Rate } & \text { Date } & \text { Date } & \text { Amount } & \text { Date } \
\hline \$ 500 & 6 \% & \text { August 8 } & \text { February 6 } & \$ 257 & \text { December 2 } \
\hline
\end{array}$$
A) $251.74
B) $255.45
C) $255.70
D) $245.67

Quizplus · Accepted Answer

The United States Rule for partial payments involves calculating interest up to the date of the partial payment, reducing the principal by the partial payment, and then calculating interest on the new principal amount until maturity. Here, interest from August 8 to December 2 (116 days) on $500 at 6% per annum is calculated, the partial payment of $257 is subtracted from the principal plus interest to find the new principal, and then interest is calculated on this new principal from December 2 to February 6 (66 days). The correct balance due at maturity, considering these calculations, is $255.45.

A Partial Payment Is Made on the Date(s) Indicated A) $25174 B) $255

A Partial Payment Is Made on the Date(s) Indicated A) $25174
B) $255