Karen's Katering borrows $5,500, at 8.5% interest, for 220 days. If the bank uses the exact interest method, how much interest will the bank collect? (Round to the nearest cent.)$281.78$285.69$300.10$467.50

The objective of the question is to calculate the exact interest that the bank will collect on a…

Answered: Karen's Katering borrows $5,500, at…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Use the ordinary interest method, 360 days, to solve the following word problem. Round to the nearest cent when necessary. Roni Lockard signed a $28,500 simple discount promissory note at a certain bank. The discount rate was 13%, and the note was made on February 18 (not in a leap-year) for 116 days. (a) What proceeds (in $) will Roni receive on the note? $ (b) What is the maturity date of the note?
You are the loan department supervisor for a bank. This installment loan is being paid off early, and it’s your task to calculate the rebate fraction, the finance charge rebate (in $), and the payoff for the loan (in $). (Round to the nearest cent)
I need help with finance homework questions asap. (rounded to 2 decimal places) 7 If a bank charges an interest rate of 0.18% per week on loans, what rate must the bank quote?
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If you sign a discount note for $7,500 at a bank discount rate of 5% for 3 months, what is the effective interest rate? Round to the nearest tenth percent. Step 1 The effective interest rate is the actual interest rate charged on a discounted note and takes into account the fact that the borrower does not receive the full amount of the principal. It is calculated using the bank discount, the proceeds, and time. The bank discount is calculated as follows where the discount rate is given as a decimal and the time will be a fraction whose numerator is the given amount of time in months and denominator is 12 months. bank discount = face value ✕ discount rate ✕ time The rate was given to be 5%. As a decimal, we have . Calculate the bank discount (in $) for the $7,500 promissory note at a discount of 5% for 3 months. bank discount = face value ✕ discount rate ✕ amount of time in months 12 months = $7,500 ✕ ✕ 3 12 = $
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Karen's Katering borrows $5,500, at 8.5% interest, for 220 days. If the bank uses the exact interest method, how much interest will the bank collect? (Round to the nearest cent.) $281.78 $285.69 $300.10 $467.50