Question
In: Finance
Adela borrowed $10,500 at 12% ordinary interest for 170 days. After 40 days, she made a...
Adela borrowed $10,500 at 12% ordinary interest for 170 days. After 40 days, she made a partial payment of $3,000. After another 80 days, Adela made a second partial payment of $2,000. What is the final amount due on the loan?
Solutions
Expert Solution
Since there is ordinary interest, there should be 360 days a year calculation.
After 40 days:
Balance amount due = 10,500 + 10,500 × 0.12 × (40/360) – 3,000
= 10,500 + 140 – 3,000
= 7,640
After 80 days:
Balance amount due = 7,640 + 7,640 × 0.12 × (80/360) – 2,000
= 7,640 + 203.73 – 2,000
= 5,843.73
On 170 days:
Final amount = 5,843.73 + 5,843.73 × 0.12 × [{(170 – (40 + 80)}/360]
= 5,843.73 + 5,843.73 × 0.12 × (50/360)
= 5,843.73 + 97.40
= 5,941.13 (Answer)
jeff jeffy answered 9 months agoRelated Solutions
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