Final answer:
The interest charged on a $50,000, 60-day note at a rate of 6% would be $500, calculated by the formula Interest = Principal × rate × time, with the rate and time converted to the appropriate terms for the period.
Step-by-step explanation:
The correct answer to the question is B. $500. To calculate the interest charged on a note payable, you use the formula: Interest = Principal × rate × time. For a $50,000 loan at a 6% annual rate over 60 days, you must first convert the annual interest rate to a daily rate and the time period to a fraction of the year. The annual rate of 6% must be divided by 360 or 365, depending on the convention, to find the daily rate; here we will use 360 for simplicity. This gives us 0.06/360.
Next, convert the 60-day term to a fraction of a year, which is 60/360. The calculation becomes: $50,000 × (0.06/360) × (60/360). Simplifying, the interest is $50,000 × 0.06 × (60/360) = $500. Therefore, the simple interest on this loan for 60 days is $500.