Question

Polly Flynn borrowed $5,000 for 60 days at 7%. On day 20 Polly made a $2,000...

Polly Flynn borrowed $5,000 for 60 days at 7%. On day 20 Polly made a $2,000 partial payment ( assume ordinary interest). What is her final payment? How much did she save by making the partial payment?

Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

>>>>

Amount borrowed = $5,000

Interest upto 20 days = $5,000 * 7% * 20 days / 360 days = $19.4444

Total amount at the time of partial payment = $5,000 + $19.4444 = $5,019.4444

Balance after partial payment = $5,019.4444 - $2,000 = $3,019.4444

Interest for 40 days = Balance after partial payment * 7% *40 days / 360 days

= $3,019.4444 * 7% * 40 /360

= $23.4846

Amount to be repaid = $3,019.4444 + $23.4846 = $3,042.929

Therefore, amount to be repaid is $3,042.93

>>>>

Interest without partial payment = $5,000 * 7% * 60 days / 360 days = $58.3333

Total payment = $5,000 + $58.3333 = $5,058.33

Amount saved = $5,058.33 - $3,042.93 - $2,000 = $15.40

Therefore, amount saved due to partial payment is $15.40

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Kari borrowed $13,500 at 7% ordinary interest for 170 days. After 20 days, she made a...
Kari borrowed $13,500 at 7% ordinary interest for 170 days. After 20 days, she made a partial payment of $3,000. After another 100 days, Kari made a second partial payment of $1,000. What is the final amount due on the loan?
Raul Fletes borrowed ​$10,000 on a 90​-day note that required ordinary interest at 11.25​%. Raul paid...
Raul Fletes borrowed ​$10,000 on a 90​-day note that required ordinary interest at 11.25​%. Raul paid ​$5,000 on the note on the 30th day. How much interest did he save by making the partial​ payment?
Raul Fletes borrowed ​$10,000 on a 300​-day note that required ordinary interest at 12.51%. Raul paid...
Raul Fletes borrowed ​$10,000 on a 300​-day note that required ordinary interest at 12.51%. Raul paid ​$5,000 on the note on the 250th day. How much interest did he save by making the partial​ payment?
a.Dr. Vaccarro invested his money at 12.5% for 175 days and earned interest of $760. How...
a.Dr. Vaccarro invested his money at 12.5% for 175 days and earned interest of $760. How much money did Dr. Vaccarro invest? b.In June, Becky opened a $20,000 bank CD paying 1% interest, but she had to withdraw the money in a few days to cover one child's college tuition. The bank charged her $1,000 in penalties for the withdrawal. What percent of the $20,000 was she charged c.Find how long in days David Wong must invest $23,500 of his...
Meghan Brown borrowed $50,000, on a 90-day 10% note. After 55 days, Brown made an initial...
Meghan Brown borrowed $50,000, on a 90-day 10% note. After 55 days, Brown made an initial payment of $9,000. On day 70, Brown made an additional payment of $10,000. Assuming the U.S. Rule, what is the adjusted balance of the first payment? Use 360 days.
A 20-year-old student wants to save $5 a day for her retirement. Every day, she places...
A 20-year-old student wants to save $5 a day for her retirement. Every day, she places $5 in a drawer. At the end of EACH year, she invests the accumulated savings in an automated account with an expected annual return of 9%, paid annually. A) If she begins saving today; How much money will she have when she is 65? (4 points) B) If she did not start saving until she was 45 years old, how much would she have...
Able Co. accepted a $20,000 note on March 10 with terms of 6%, 60 days. Able...
Able Co. accepted a $20,000 note on March 10 with terms of 6%, 60 days. Able Co. discounted the note on March 20, at the Green Bank at 7%. Use ordinary interest. What net proceeds did Able receive?
1. Sarah is planning to purchase her own home as her first real estate investment. The...
1. Sarah is planning to purchase her own home as her first real estate investment. The home is selling for $200,000 and she needs a 20% down payment. The loan will be for 30 years at 3.5% interest. What is Sarah’s monthly payment? How much money would Sarah save over the life of the loan if she obtained a 15-year loan at the same rate? If Sarah did not have the down payment and could save $850 per month at...
1. Yuliya's credit card had balances of $800 for 15 days, $600 for 5 days, and...
1. Yuliya's credit card had balances of $800 for 15 days, $600 for 5 days, and $650 for 10 days. Assume an annual interest rate of 18 percent, 30-day billing cycle and 20-day grace period. How much is the interest charge using the average daily balance method, if the credit card gets paid off five days after the statement due date? (Show your calculations) 2. Del Monte bought a new car for $38,000 with a loan that will be amortized...
You must show your work for credit. Simply giving the final answer is not sufficient; you...
You must show your work for credit. Simply giving the final answer is not sufficient; you must explain and show how you arrived at each answer. Ignore all taxes in your Your sister turned 20 today. She is planning to save $5,000 per year for retirement, with the first deposit to be made one year from today. She will invest in a mutual fund that's expected to provide a return of 7% per year, compounded annually. She plans to retire...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT