Rosewood Inc.recently signed a $350,000,six-month note on August 22,2013.The interest rate is 6.5%.How much total interest will be due on the note at maturity?

Question

Quizplus · Accepted Answer

The formula to calculate simple interest is:
Interest = Principal x Rate x Time
Here, the principal is $350,000, the rate is 6.5%, and the time is 6 months.
Converting the rate to a decimal form: 6.5/100 = 0.065

Using the formula:
Interest = $350,000 x 0.065 x (6/12)
Interest = $350,000 x 0.065 x 0.5
Interest = $11,375

Therefore, the total interest due on the note at maturity is $11,375. Thus, the best choice is C.