Using the intereset rate formula, the tabe can be completed after computing the missing amounts as follows:
Principal Amount Annual Interest Time Interest
on Notes Receivable Rate Period Earned
a. $70,000 11.2 % 6 months $3,920
b. $44,000 10.4 % 9 months $3,432
c. $34,000 9.4 % 12 months $3,196
a) Interest Earned = (Principal x Rate x Time)
= $3,920 ($70,000 x 11.2% x 6/12)
b) Annual Interest Rate = (Interest Amount/Principal ÷ Time)
= 10.4% ($3,432/$44,000 x 12/9)
c) Principal = (Interest Amount/Interest Rate ÷ Time)
= $34,000 ($3,196/9.4%)
Thus, the table has been filled for the missing amounts.
Complete Question:
Complete the following table by computing the missing amounts for the following independent cases. (Do not round intermediate calculations. Round "Annual Interest Rate" to 1 decimal place.)
Principal Amount Annual Interest Time Interest
on Notes Receivable Rate Period Earned
a. $70,000 11.2 % 6 months ?
b. $44,000 % 9 months $3,432
c. ? 9.4 % 12 months $3,196