Question

Jones of Boston borrowed $40,000, on a 90-day 10% note. After 60 days, Jones made an initial payment of $6,000. On day 80, Jones made an additional payment of $7,000. Assuming the U.S. Rule, what's the adjusted balance of the first payment? (Use 360 days.) A. $34,666.67 B. $49,666.67 C. $54,696.67 D. $56,696.67

Answer 1

Balance on 60th day PRIOR to payment
=40000(1+10%*(60/360))
=40666.67

Balance after payment of $6000
=40666.67-6000
=$34666.67

Answer 2

As per simple interest, the adjusted balance of the first payment is $34666.67.

What is simple interest?

"Simple interest is a method to calculate the amount of interest charged on a sum at a given rate and for a given period of time."

The borrowing amount = P = $40000

Percentage interest is = r = 10% = 0.1

Paying amount after t = 60 days

= P(1 + rt)

= $40000[1 + 0.1 × (60/360)]

= $40666.67

Jones paid a sum of $6000 on 60 days before payment.

Therefore, the adjusted balance of the first payment

= $(40666.67 - 6000)

= $34666.67

Learn more about simple interest here: https://brainly.com/question/11315465

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