Asked by christie xiong on May 01, 2024
Verified
A six-month non-interest-bearing promissory note issued on April 11, 2015, for $4,000 was discounted at 6.25% simple interest on September 2, 2015. What were the proceeds of the note?
Non-Interest-Bearing
Pertaining to debt or security that does not earn interest over time, usually issued at a discount to its redemption value.
Simple Interest
The calculation of interest that exclusively considers the initial amount of money deposited or borrowed, without compounding.
- Calculate the income derived from discounting non-interest-bearing promissory notes before they reach maturity.
Verified Answer
VH
Learning Objectives
- Calculate the income derived from discounting non-interest-bearing promissory notes before they reach maturity.
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