Question

Shawn Bixby borrowed $30,000 on a 150-day, 12% note. After 65 days, Shawn paid $3,300 on the note. On day 106, Shawn paid an additional $5,300. Use ordinary interest. Determine the total interest use the U.S. Rule. Note: Do not round intermediate calculations. Round your answer to the nearest cent. Determine the ending balance due use the U.S. Rule. Note: Do not round intermediate calculations. Round your answer to the nearest cent.

Answer 1

Total interest will be 2496.4 for the money that Shawn Bixby borrowed.

What is interest?

The sum that is paid in monetary form for using another person's money is known as interest.

Interest expense

30,000 x 12% x 150 days/360 = 1500

Payment  deducted from the note:

3300 - 1500 = 1800

30,000 - 1800 = 28200

interest expense

28200 x 12% x 106/360 = 996.4

Deduced from the note

5300 - 996.4 = 4303.6

28200 - 4303.6 = 23896.4

Adding both the interest expense 996.4  and 1500 interest expense

996.4 + 1500 = 2496.4

The total interest will be 2496.4 which needs to be paid.

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