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Roscoe Company purchased equipment on November 1, 2020 and gave a 9-month, 5% note with a face value of $42,139 to pay for the equipment. Interest and principle are paid back when the entire loan is due. What is the amount of total cash paid back at the end of the loan, including principle and interest (this is a simple interest loan)

Respuesta :

Tundexi

Answer:

$44,070.44

Explanation:

Simple interest formula = P*R*T

Where P = Loan amount = $42,139 , R = Rate on interest = 5% per year, N = 11 month/0.9167

Interest = 42,139*5%*0.9167

Interest = 42,139*0.05*0.9167

Interest = 1931.441065

Interest = $1,931.44

Total amount payable after 11 months = $42,139 + $1,931.44 = $44,070.44

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