Answer:
A. February 26th
B. $3,500 - Balance ≈ $6,697.26
C. $2,500 - Balance ≈ $4,263.46
D. $4,284.81
Explanation:
a) What is the due date of the loan?
The loan term is given as 317 days, and the loan starts on April 15th. To find the due date, we will add 317 days to April 15th.
April 15th + 317 days = April 15th + (365 days - 48 days) = April 15th + 1 year - 48 days
Subtracting 48 days from April 15th, we get:
Due date = February 26th (of the following year)
b) Calculate the interest due on October 12th and the balance of the loan after the October 12th payment.
First, we need to calculate the number of days between April 15th and October 12th:
April (15 days) + May (31 days) + June (30 days) + July (31 days) + August (31 days) + September (30 days) + October (12 days) = 180 days
Now, we will calculate the interest for 180 days:
Interest = Principal × Interest Rate × (Days Passed / 365)
Interest = $10,000 × 0.04 × (180 / 365)
Interest ≈ $197.26
Peter will make a payment of $3,500 on October 12th. So, we need to find the balance of the loan after this payment:
Balance = Principal + Interest - Payment
Balance = $10,000 + $197.26 - $3,500
Balance ≈ $6,697.26
c) Calculate the interest due on January 11th and the balance of the loan after the January 11th payment.
First, we need to calculate the number of days between October 12th and January 11th:
October (19 days) + November (30 days) + December (31 days) + January (11 days) = 91 days
Now, we will calculate the interest for 91 days:
Interest = Principal × Interest Rate × (Days Passed / 365)
Interest = $6,697.26 × 0.04 × (91 / 365)
Interest ≈ $66.20
Peter will make a payment of $2,500 on January 11th. So, we need to find the balance of the loan after this payment:
Balance = Principal + Interest - Payment
Balance = $6,697.26 + $66.20 - $2,500
Balance ≈ $4,263.46
d) Calculate the final payment (interest + principal) Peter must pay on the due date.
First, we need to calculate the number of days between January 11th and February 26th:
January (20 days) + February (26 days) = 46 days
Now, we will calculate the interest for 46 days:
Interest = Principal × Interest Rate × (Days Passed / 365)
Interest = $4,263.46 × 0.04 × (46 / 365)
Interest ≈ $21.35
Finally, we will calculate the final payment Peter must pay on the due date:
Final payment = Principal + Interest
Final payment = $4,263.46 + $21.35
Final payment ≈ $4,284.81