A promissory note has a face value of $5175.00 and it has a date of issue of April 2 this year. The term is for 5 months. The rate of interest is 6.75%. What is the maturity value of the note? Select one: A. $5334.20 B. $5234.30 C. $5342.30 D. $5324.30 E. $5444.30

A promissory note has a face value of $5175.00 and it has a date of issue of April 2 this year. The term is for 5 months. The rate of interest is 6.75%. What is the maturity value of the note? Select one: A. $5334.20 B. $5234.30 C. $5342.30 D. $5324.30 E. $5444.30

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter9: Accounting For Receivables

Section: Chapter Questions

Problem 21MC: A customer takes out a loan of $130,000 on January 1, with a maturity date of 36 months, and an...

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Concept explainers

Cost of Credit

The cost of credit is an extra amount that the borrower has to pay besides the loan amount. These credit charges may vary from loan to loan. The cost of credit includes interest charges, maintenance charges, and arrangement charges. Some of the costs are mandatorily collected by the lender based on the loan amount and tenure of the loan. The cost of credit is also called finance charges of the credit.

Question

A promissory note has a face value of $5175.00 and it has a date of issue of April 2 this year. The
term is for 5 months. The rate of interest is 6.75%. What is the maturity value of the note?
Select one:
A.
$5334.20
B.
$5234.30
C.
$5342.30
D.
$5324.30
E.
$5444.30

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