Sean R.

asked • 03/22/15

Kaylee Putty signed a $8,000 note for 140 days at a discount rate of 5%. Find the discount and proceeds Kaylee received. (Assume 360 days)

business math
 

1 Expert Answer

By:

Kelsy F. answered • 01/12/21

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Maturity value: $8,000

Discount rate: 5/100 (annual)

Time: 140/360


Bank discount = maturity value x discount rate x time

Bank discount = $8,000 x 5/100 x 140/360

Bank discount = $155.56 or $156 rounded to the nearest dollar


Proceeds = maturity value - bank discount

Proceeds = $8,000 - $156

Proceeds = $7,844

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