SOLUTION: On January 1, Mustafa borrows $1000 on a demand loan from his bank. Interest is paid at the end of each quarter (March 31, June 30, September 30, December 31) and at the time of th
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Question 886006: On January 1, Mustafa borrows $1000 on a demand loan from his bank. Interest is paid at the end of each quarter (March 31, June 30, September 30, December 31) and at the time of the last payment. Interest is calculated at the rate of 12% on the balance of the loan outstanding. Mustafa repaid the loan with the following payments:
March 1 $100
April 17 $300
July 12 $200
August 20 $100
October 18 $300
Total $1000
Calculate the interest payments required and the total interest paid.
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rembal is the remaining balance after the interest has been accrued and the payment has been made.
pmt is the payment
int is the interest
pmt+int is the total payment made which includes the principal plus the interest that is due.
for example:
march shows a remaining balance of 900.
that remaining balance is equal to the 1000 in january plus interest of 120 that accrued from january to march minus payment of 220 made in march.
the payment in march included the principal which was 100 and the interest due which was equal to 120.
