Asked by Kimberly Tieman on Apr 25, 2024
Verified
The maturity value of a $60000 6% 3-month note receivable is
A) $61200.
B) $60360.
C) $60900.
D) $63600.
Maturity Value
The total amount that will be paid to an investor at the end of a bond's term or the face value plus any interest.
Note Receivable
A written promise for amounts to be received by a debtor, acknowledging a debt to be paid to the creditor at a future date.
- Ascertain the amount of cash to be received at the maturity of a promissory note.
Verified Answer
NT
NAVDEEP TRIPATHI6 days ago
Final Answer :
C
Explanation :
The formula for calculating the maturity value of a note receivable is:
Maturity value = Principal + Interest
where Interest = Principal x Rate x Time
In this case, the principal is $60000, the rate is 6%, and the time is 3 months.
First, we need to calculate the interest:
Interest = $60000 x 6% x (3/12) = $900
Next, we can calculate the maturity value:
Maturity value = $60000 + $900 = $60900
Therefore, the best choice is C.
Maturity value = Principal + Interest
where Interest = Principal x Rate x Time
In this case, the principal is $60000, the rate is 6%, and the time is 3 months.
First, we need to calculate the interest:
Interest = $60000 x 6% x (3/12) = $900
Next, we can calculate the maturity value:
Maturity value = $60000 + $900 = $60900
Therefore, the best choice is C.
Learning Objectives
- Ascertain the amount of cash to be received at the maturity of a promissory note.
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