On October 15, Daniel Miller accepted a $5,000, 60-day, 8% note from Bill Boyer granting a time extension on a past-due amount. Daniel discounted the note at Volve Bank at 9% on Oct. 26. Use ordinary interest. Calculate Daniel's proceeds.

Question

Quizplus · Accepted Answer

5,000 × .08 × 60/360 = $66.67; MV = 66.67 + 5,000 = $5,066.67; Days left = 60 - 11 = 49 days; Bank charge = $5,066.67 × .09 × 49/360 = $62.07; Proceeds = $5,066.67 - $62.07 = $5,004.60.

On October 15, Daniel Miller Accepted a $5,000, 60-Day, 8