Question

On June 8, Williams Company issued an $90,000, 9%, 120-day note payable to Brown Industries. Assuming a 360-day year, what is the maturity value of the note? Round your answer to the nearest whole dollar.a. $5,712

b. $83,504
c. $87,312
d. $81,600e. None of the above

Answer 1

e. None of the above

Step-by-step explanation:

The computation of the maturity value is shown below:

= Issues amount + interest

where,

Issued amount = $90,000

And, interest equal to

= Issued amount × rate of interest × number of days ÷ (total number of days in a year)

= $90,000 × 9% × (120 days ÷ 360 days)

= $2,700

So, the maturity value would be

= $90,000 + $2,700

= $92,700

This is the answer but the same is not provided