Question

Duerr Company makes a $79,000, 30-day, 12% cash loan to Ryan Co. The note and interest to be collected at maturity is: (Use 360 days a year.)a. $79,000.b. $790.c. $79,790.d. $78,210.e. $88,480.

Answer 1

c. $79,790

Step-by-step explanation:

The computation of the note and interest collected at maturity date is showb below:

Maturity value = Principal + interest

where,

Principal is $79,000

And, the interest is

= $79,000 ×30 days ÷ 360 days × 12%

= $790

So, the maturity value is

= $79,000 + $790

= $79,790

Hence, the maturity value is $79,790

Therefore the correct option is c.