Answered: Luke got a $10,400.00 face-value note…

Luke got a $10,400.00 face-value note for 250 days with a discount rate of 8.5%. A) Find the discount amount with 360-day year. B) Find the proceeds. C) Find the APR.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter12: Current Liabilities

Section: Chapter Questions

Problem 15MC: Marathon Peanuts converts a $130,000 account payable into a short-term note payable, with an annual...

See similar textbooks

Related questions

Q: Jim Hopper plans to place his money in a certificate of deposit that matures in three months. The…

A: A certificate of deposit is a fixed income instrument issued by banks and credit unions. Interest…

Q: Dylan deposits $10,000 now and makes an additional deposit of $5,000 at the end of Year 3 in the…

A: Interest charged on the principal amount and the interest accrued is known as Compound Interest. It…

Q: For items 16-30, when asked about an amount of money (interest, discount, present value, future…

A: Since you have posted a question with multiple sub-parts, we will solve the first three subparts for…

Q: Connie made deposits of $2,000 at the beginning of each year for four years. The rate she earned is…

A: Given:

Q: Jason makes six EOY deposits of $2,000 each in a savings account paying 5% compounded annually. If…

A: The compound interest is calculated on the principal amount annually. It considers the present value…

Q: On March 1, 2012, Jason's Deli loaned $12,000 to Mark Johnson for one year at 5 percent interest.…

A: Given the following information: Principal amount: $12,000 Interest rate: 5% Time period: From…

Q: Kim deposits $1,000 in a savings account. Four years after the deposit, half the account balance is…

A: Compounding is a technique through which future value of present amount is computed at given rate of…

Q: HiLo purchased inventory for $30,000 by signing a 4% 4-month note. How much would HiLo need to repay…

A: Notes are instrument issued by company acknowledging the debt raised by company . It is a liability…

Q: To remodel your business, you need to sign a 190-day note with proceeds of $16,559.57 and a maturity…

A: Solution Given Maturity period of note 190 days Issue proceed 16559.57 Maturity…

Q: arla Vista Co. receives a $60,400, 6-year note bearing interest of 7% (paid annually) from a…

A: Computation Present value of the note receivable by carla vista [Amount received * interest *…

Q: Andrew T. invested $15,000 in a high-yield account. At the end of 30 years he closed the account and…

A: Effective interest rate, also known as the annual equivalent rate is the interest rate which takes…

Q: Trevor purchased a 90-day interest-bearing note at 4.80% p.a. that has a face value of $25,000.00.…

A: Solution:- When an interest bearing note is purchased, it provides interest to the holder. So,…

Q: Cardo borrowed money from a local cooperative. He received P18,420 but promised to pay P20,000 in…

A: Present Value = 18,420 Future Value = 20,000

Q: Lee purchased a laptop and promised to pay P2500 every month for 2 years, beginning on the date of…

A: Purchase of Assets on Loan Monthly payment Need to calculate prepayment price to close the liability

Q: Vhutshilo won R165 000 and decided to deposit 65% of this amount in an account earning 8,25%…

A: In this question we need to compute the accumulated amount after 5 years i.e. future value after 5…

Q: Sean decided to put the note to market for sale. Finally, Tom purchased it on June 30, 2021. Find…

A: No Coupon Bond Face Value = 5000 Monthly Compounding Interest Rate = 4.8%/12 = 0.40% Time Period =…

Q: On September 19, Lynn Knight joined a Christmas club. Her bank will automatically deduct $100 from…

A: a) Computation: Hence, the future value is $201.50.

Q: A bank offers a 12% interest to be compounded annually. How much should a teacher deposit now if he…

A: Present value is the value of future cash flows discounted at a specified interest rate for a…

Q: Robert bought a photocopying machine on an installment basis with 15, 103 downpayment and 84 monthly…

A: Present Value(PV) is current value of any future amount. It is calculated by discounting that future…

Q: Greg owns a promissory note, due in 2 years hence, whose maturity value is 7,500 php. If the rate of…

A: Maturity value (MV) = Php. 7500 Interest rate = 11.50% Bimonthly interest rate (r) = 11.50%/6 =…

Q: What are the proceeds (in $)?

A: A promissory note is a written form in which one party promises ta pay to other party for some…

Q: On April 1, 1998, John opened a savings account with a nominal interest rate of 3.4% payable monthly…

A: Quaterly deposit in investment fund is $400 Interest rate of quaterly fund is 4.6% payable quaterly…

Q: Soledad receives a bill for P18,000 dated July 7 with terms 6/15, 4/30, n/60. What cash discount…

A: The term credit sales represent a transfer of goods or services to a customer but the payments are…

Q: On March 1, 2012, Jason's Deli loaned $12,000 to Mark Johnson for one year at 5 percent interest.…

A: Given the following information: Principal amount: $12,000 Interest rate: 5% Time period: from…

Q: Gabe opened an RRSP deposit account on December 1, 2008, with a deposit of $2000. He added $2000…

A: Computation:

Q: On January 1, 2020, Tasya opened a savings account of IDR 1,000,000. After that date every month for…

A: The portion of one's income that is not spent on current costs is referred to as savings. In other…

Q: Sean purchased an interest-bearing promissory note for $11,000.00 at 5.00% p.a., due in 90 days. If…

A: The promissory note refers to a debt instrument that is issued by a person who writes a note by…

Q: Nesrin, purchased a new car for $9,420, paying $3,000 down payment and agreeing to 12 monthly…

A: Credit rate: The amount charged for a credit loan or purchase is usually represented as a…

Q: John bought a car with cash value of P15,294 on the installment plan under the following terms:…

A: Annuity: An annuity is the series of payments which is received or paid for a certain period of…

Q: Ahmed Yehda borrowed $8,000, signing a promissory note for 2.5 years at 15% interest. What was the…

A: Promissory note is one of the ways to borrow the amount for a particular period and specific amount…

Q: Meghan purchased a 90-day interest-bearing note at 5.20% p.a. that has a face value of $5,000.00. a.…

A: The security having short-term maturity with combined payment of principal and face value at…

Q: Miss Evilla borrowed money from a bank. She receives from the bank P1,340.00 and promised to pay…

A: Banker's discount is the discount amount calculated on the future value of payable.

Q: Shahir received a 70-day promissory note with a simple interest rate at 3.8% per annum and a…

A: Discount amount = Maturity value x discount rate x no. of days before maturity/ 365 = RM 17670 x 3%…

Q: Quinn opened an account with an initial deposit of $2500. At the end of the 2nd and 8th years, he…

A: Initial Deposit = $2500 2nd Year Deposit = $3,000 8th Year Deposit = $5,050 Withdraw = $3,000…

Q: Franki finances a motor home for $44,700 by taking out an installment loan for 36 months. The…

A: Loan carry interest rate that are to be paid by monthly payment.

Q: Jason makes six end-of-year deposits of $2,000 each in a savings account paying 5% compounded…

A: Annual deposits = $2,000 Rate = 5% First calculate the future value of annuity at the and of 6…

Q: Samuel Ng received a 3-year subsidized student loan of $15,000 at an annual interest rate of 4%.…

A: Given that: Loan Amount (A)= $15000 Time(t)= 3 years Number of payments per year (n)= 12 Annual…

Q: Jun purchase a car with a cash price of Php 1million. Payment terms were 20% down payment, balance…

A: Cash price = Php 1,000,000 Down payment = 20% Loan amount (PV) = 1,000,000*(1-0.20)…

Q: Warlo bought a laptop that is payable by monthly installment of ₱1,800 for 12 months starting at the…

A: Monthly payment = P 1800 Number of monthly payments = 12 First payment = After 2 months Annual…

Q: Helena deposited P3,000 every beginning of 6 months for 10 years at Metro Bank at 9% compounded semi…

A: FV is the future worth of cash flows that have occurred in the past or present.

Q: On April 16, Anthony borrowed$1279 to buy a new laptop. The loan had a simple interest rate of 3.8%…

A: The main source of income for banks or financial institutions is the difference between the interest…

Q: At the beginning of your freshman year, your favorite aunt and uncle deposit $10,000 intoa 4-year…

A: A theory that helps to compute the present or future value of the cash flows is term as the TVM…

Q: Samuel Ng received a 3-year subsidized student loan of $12,000 at an annual interest rate of 5%.…

A: Computation of monthly loan payments:

Q: Marathon Peanuts converts a $130,000 account payable into a short-term note payable, with an annual…

A: Formula: Interest amount = Accounts payable amount x Interest rate x Time period

Q: AN EMPLOYEE IS ABOUT TO RECEIVE THE SUM OF P300.00 AT THE END OF EACH YEAR FOR 5 YEARS. ONE YEAR…

A: Annual receipt =P 300.00 Number of annual = 5 Years Annual interest rate = 6%

Q: Marlon borrowed 15,000 Php from a lending company that charges a simple interest rate of 11%.…

A: Borrowed amount = 15000 Php. Interest rate = 11%

Q: Please show the formula used. At age 30 you deposit 150 pesos at teh end of each month into SSS…

A: The interest earned at the end of the period can be calculated with the help of future value of…

Question

100%

Luke got a $10,400.00 face-value note for 250 days with a discount rate of 8.5%.

A) Find the discount amount with 360-day year.

B) Find the proceeds.

C) Find the APR.

Expert Solution

Step 1

The proceeds will be the face value less discount.

The APR will be the annualized measure of the return on the note.

Trending now

This is a popular solution!

Step by step

Solved in 4 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.

Similar questions

Samuel Ames owes 20,000 to a friend. He wants to know how much he would have to pay if he paid the debt in 3 annual installments at the end of each year, which would include interest at 14%. Draw a time line for the problem. Indicate what table to use. Look up the table value and place it in a brief formula. Solve.
Marathon Peanuts converts a $130,000 account payable into a short-term note payable, with an annual interest rate of 6%, and payable in four months. How much interest will Marathon Peanuts owe at the end of four months? A. $2,600 B. $7,800 C. $137,800 D. $132,600
Michael Jacobson signed a simple discount note with a face value of $ 8,400 at a discount rate of 15% for four months. Find the proceeds of the note and the effective interest rate. Find the proceeds of the note The effective interest rate is what %
You sign a simple discount promissory note for $3,000 at a discount rate of 7%, for 36 months. What are the proceeds (in $)?
On January 26, Nyree Co. borrowed cash from Conrad Bank by issuing a 45-day note with a face amount of $150,000. Assume a 360-day year. a. Determine the proceeds of the note, assuming the note carries an interest rate of 10%.b. Determine the proceeds of the note, assuming the note is discounted at 10%.
HiLo purchased inventory for $30,000 by signing a 4% 4-month note. How much would HiLo need to repay when the note matures?
Joshua borrowed $500 for one year and paid $50 in interest. The bank charged him a service charge of $5. If Joshua repaid the loan in 12 equal monthly payments, what is the APR? (Enter your answer as a percent rounded to 1 decimal place.)
Soledad receives a bill for P18,000 dated July 7 with terms 6/15, 4/30, n/60. What cash discount will she received if she pays (a) in 15 days; (b) on the 25th day; and (c) on the 40th day? Round to the nearest centavo
On March 1, 2012, Jason's Deli loaned $12,000 to Mark Johnson for one year at 5 percent interest. Required:- Answer the following questions. a. What is Jason's interest income for 2012?
On October 31st, David signed a 4-month, $5,000 simple interest loan earning 7. Find the maturity date, interest, and maturity value.
An accountant purchases a T-bill with a face value of $5,000 for $4,975. If the term of the T-bill is 115 days, what is the annual simple interest rate (in percent) earned by the client? Round to the nearest tenth of a percent. (Use 360 days in 1 year.)
Given the following information, Ankit took home loan of $100,000 for 10 years. Interest Rate: 10%, Calculate the Monthly Payment? $1,302.50 $1,321.51 $1,332.50 $1,322.50