Duerr Company makes a $60,000,60-day,12% cash loan to Ryan Co.The note and interest to be collected at maturity is: $\bold{\text{(Use 360 days a year.)}}$

Question

Quizplus · Accepted Answer

To calculate the interest, we can use the simple interest formula:

Interest = Principal × Rate × Time

Principal = $60,000
Rate = 12% per year
Time = 60 days ÷ 360 days/year = 1/6 year

Interest = $60,000 × 0.12 × 1/6 = $1,200

Therefore, the total amount to be collected at maturity is:

$60,000 (principal) + $1,200 (interest) = $61,200

So, the best choice is C.

Duerr Company Makes a $60,000,60-Day,12% Cash Loan to Ryan Co (Use 360 days a year.)\bold{\text{(Use 360 days a year.)}}(Use 360 days a year.)

Duerr Company Makes a $60,000,60-Day,12% Cash Loan to Ryan Co $\bold{\text{(Use 360 days a year.)}}$