Question

Slingerland borrowed $8,000 on july 20, at 11% interest. if the loan was due on october 17, what was the amount of interest on the loan using the exact interest method?

Answer 1

I think the answer is $216.99 ?

Answer 2

The amount of interest on the loan was of $214.57.

Explanation:

Slingerland borrowed $8,000 at an 11% interest rate, thus having to pay $880 after a year.

As the loan was due on October 17, and the difference between July 20 and October 17 is of 89 days, using the exact interest method we can affirm that:

880 / 365 x 89 = X

2.41 x 89 = X

$214.57 = X

The amount of interest on the loan was of $214.57.