posted by Anonymous
toby signed a simple discount promissory note for $20,000. the discount rate is 8.5%, and the term of the note is 90 days. what are toby's proceeds on the loan?
Ar = Ab - Ad
Ar = 20,000 - 20,000*(0.085/360)*90 =
20,000 - 425 = $19,575 = Amount received
Ab = Amt. borrowed.
Ad = Amt. discounted.