Question

# Solve for maturity value, discount period, bank discount, and proceeds.  Solve for maturity value, discount period, bank discount, and proceeds. Assume a bank discount rate of 9%. Use the ordinary interest method. (Use Days in a year table.) (Do not round intermediate calculations. Round your final answers to the nearest cent.)

Face Value = 26300

bank discount rate or rate of interest = 9%

Length of note = 65 days

So, interest = 26300* 9% * 65/360 = \$427.38

Maturity Value = 26300+ 427.38= \$26727.38

Discount Period = 34-65 = 31 days

Bank Discount = \$26727.38 * 9% * 31/360 = \$207.14

Proceeds = Maturity Value - Bank Discount = \$26727.38 - \$207.14= \$26934.52

Face Value P = \$26300

Bank discount rate D =9%

Rate of interest R = 9%

Length of note LN = 65 days

Since Interest I =PRT

Therefore Interest I = \$26300(9/100)(65/360) = \$427.375=\$427.38

Since Maturity Value MV = P+I

Therefore Maturity Value MV = \$26300+ \$427.38= \$26727.38

Since Discount Period DP = LN - (Day of discount in table - day of note in days table)

Therefore  Discount Period DP = 65 - (110-76) = 65-34 = 31 days

Since, Bank Discount DB = (MV)(D)((DP)

Therefore Bank Discount DB = \$26727.38(9/100)(31/360) = \$207.137195 = \$207.14

Since Proceeds PS = MV - BD

Therefore Proceeds PS = \$26727.38 - \$207.14= \$26520.24

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