A company borrowed $150,000 on May 1, 2013 and signed a promissory note bearing interest at...

 

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A company borrowed $150,000 on May 1, 2013 and signed a promissory note bearing interest at 10% for 6 months. On the maturity date, the company paid the interest in full and gave a second not without interest for 6 months, which discounted note at 11% on the day it was signed where the proceeds were just sufficient to pay the debt. Find: a) The amount of interest paid on the first promissory note (2 marks) b) The face value of the second note. (3 marks) c) Debts of $2,500 is due 3 months ago and $2,000 due in 6 months to be settled by a payment of $1,500 now and final payment 9 months from now. Find the value of final payment at 11% simple interest rate with a focal date at the present. (5 marks) A company borrowed $150,000 on May 1, 2013 and signed a promissory note bearing interest at 10% for 6 months. On the maturity date, the company paid the interest in full and gave a second not without interest for 6 months, which discounted note at 11% on the day it was signed where the proceeds were just sufficient to pay the debt. Find: a) The amount of interest paid on the first promissory note (2 marks) b) The face value of the second note. (3 marks) c) Debts of $2,500 is due 3 months ago and $2,000 due in 6 months to be settled by a payment of $1,500 now and final payment 9 months from now. Find the value of final payment at 11% simple interest rate with a focal date at the present. (5 marks)

Answer rating: 100% (QA)

a To find the amount of interest paid on the first promissory note we need to calculate the interest ... View the full answer