Final answer:
The maturity value of the $600,000, 12 percent, 90-day note is $618,000, which includes the original principal and the accrued interest over the 90-day period.
Step-by-step explanation:
The maturity value of a note includes both the principal amount and the interest earned or due over the period until its maturity. To calculate the maturity value of the given $600,000 note with a 12 percent annual interest rate for 90 days, we first need to find the total interest accrued over the 90-day period.
Interest can be calculated using the formula:
Interest = Principal × Interest Rate × (Time / 360)
(Assuming a bank year of 360 days)
Substituting the given values:
Interest = $600,000 × 12% × (90 / 360)
= $600,000 × 0.12 × 0.25
= $18,000
Now, we add the interest to the principal to find the maturity value:
Maturity Value = Principal + Interest
= $600,000 + $18,000
= $618,000
Therefore, the maturity value of the note is $618,000.