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    Mary Jane Palermo
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    The document contains 10 examples calculating interest earned on P500,000 principal at 4% interest rate for various time periods using both exact interest for actual time and ordinary interest for approximate time. For each example, the actual time period is calculated in days from start to end date and the approximate time period is rounded to full years and months. Exact interest and ordinary interest amounts are computed and compared.

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    The document contains 10 examples calculating interest earned on P500,000 principal at 4% interest rate for various time periods using both exact interest for actual time and ordinary interest for approximate time. For each example, the actual time period is calculated in days from start to end date and the approximate time period is rounded to full years and months. Exact interest and ordinary interest amounts are computed and compared.

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    © All Rights Reserved
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    18 views6 pages

    BANKING

    Uploaded by

    Mary Jane Palermo
    The document contains 10 examples calculating interest earned on P500,000 principal at 4% interest rate for various time periods using both exact interest for actual time and ordinary interest for approximate time. For each example, the actual time period is calculated in days from start to end date and the approximate time period is rounded to full years and months. Exact interest and ordinary interest amounts are computed and compared.

    Copyright:

    © All Rights Reserved
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    of 6

    NAME: MARY JANE P.

    PALERMO BSBA 3B FM

    EXACT INTEREST & ORDINARY INTEREST USING ACTUAL & APPROXIMATE TIME

    ACTIVITY/ASSIGNMENT #1
    GIVEN: P = P500,000 r = 4%

    Compute for the Interest using Actual and Approximate Exact Interest for Actual Time and
    Ordinary Interest for Approximate time.

    1. APRIL 7, 2009 TO JULY 29, 2022


    2. APRIL 18, 2000 TO JAN 1, 2009
    3. NOVEMBER 1, 2003 TO DEC 29 2004
    4. MARCH 19, 2010 TO DEC 11, 2021
    5. MAY 20, 2018 TO AUG 14 2022
    6. FEB 7 TO JUNE 24 2005
    7. MAY 10, 2004 TO APRILL 22, 2016
    8. JULY 4 2006 TO DEC 13 2007
    9. JAN 17, 1969 TO JAN 17, 2023
    10.JUNE 18, 2012 TO JUNE 18 2022

    ANSWER:
    1. GIVEN: P = P500,000 r = 4% t = April 7 , 2009 – July 29, 2022

    April 30 – 7 23 Year Months Days


    May 31 2022 7 29
    June 30 2009 4 07
    July 29 13 3 22
    113 13x360 = 4680
    13*365 = 4745 3x30 = 90
    4858 Actual Time 22
    4,792 Approximate Time
    Ie = ₱500,000 x .04 x 4858/365
    = ₱266,191.78
    EXACT INTEREST

    Io = ₱500,000 x .04 x 4792/360


    = ₱266,222.22
    ORDINARY INTEREST
    2. GIVEN: P= ₱500,000 R= 4% T= APRIL 18, 2000 – JANUARY 1, 2009

    April 30 – 18 12
    May 31
    June 30
    July 31
    August 31
    September 30
    October 31
    November 30
    December 31
    January 1
    258
    8*365= 2920
    3178 Actual Time

    Year Months Days


    2009 2008 1 13 12 31
    2000 4 18
    8 8 13

    8x360 = 2880
    8x30 = 240
    = 13
    3133 Approximate Time

    Ie = ₱500,000 x .04 x 3178/365


    = ₱174,136.99 EXACT INTEREST

    Io = ₱500,000 x .04 x 3133/360


    = ₱174,055.56 ORDINARY INTEREST

    3. GIVEN: P= ₱500,000 R=4% T=NOVEMBER 1, 2003 – DECEMBER 29, 2004

    November 30 – 1 29
    December 29
    58
    1*365= 365
    423 Actual Time
    Year Month Days
    2004 12 29
    2003 11 1
    1 1 28
    1x360 = 360
    1x30 = 30
    28
    418 Approximate Time

    Ie = ₱500,000 x .04 x 423/365


    = ₱23,178.08 EXACT INTEREST

    Io = ₱500,000 x .04 x 418/360


    = ₱23,222.22 ORDINARY INTEREST

    4. GIVEN: P= ₱500,000 R=4% T= MARCH 19, 2010 – DECEMBER 11, 2021

    YEAR MONTH DAYS


    2021 12 11 11 41
    2010 3 19
    11 8 22

    11*360 = 3,960
    8*30 = 240
    22
    4,222 APPROXIMATE TIME

    March 31 – 19 12
    April 30 11*365 = 4,015 + 267
    May 31 = 4,282 ACTUAL TIME
    June 30
    July 31
    August 31
    September 30
    October 31
    November 30
    December 11 =267
    Ie = ₱500,000 x .04 x 4282/365
    =₱234,360.14 EXACT INTEREST

    Io = ₱500,000 x .04 x 4,222/360


    =₱234,555.56 ORDINARY INTEREST

    5. GIVEN: P= ₱500,000 R=4% T= MAY 20, 2018 - AUGUST 14, 2022

    YEAR MONTH DAYS


    2022 8 7 14 44
    2018 5 20
    4 2 24
    4*360 = 1,440
    2*30 = 60
    = 24
    1,524 APPROXIMATE TIME

    May 31 – 20 19 4*365 = 1460


    June 30 94
    July 31 1,554 ACTUAL TIME
    August 14 =94

    Ie = ₱500,000 x .04 x 1,554/365


    = ₱85,150.68 EXACT INTEREST

    Io = ₱500,000 x .04 x 1524/360


    = ₱84,666.67 ORDINARY INTEREST

    6. GIVEN: P= ₱500,000 R=4% T= FEBRUARY 7, - JUNE 24, 2005

    YEAR MONTH DAYS


    2005 6 24
    2005 2 7
    0 4 17

    4*30 = 120+17 = 137 APPROXIMATE TIME


    February 28 – 7 21
    March 31
    April 30
    May 31
    June 24
    137 ACTUAL TIME

    Ie = ₱500,000 x .04 x 137/365


    =₱7,506.85 EXACT INTEREST

    Io = ₱500,000 x .04 x 137/360


    = ₱7,611.11 ORDINARY INTEREST

    7. GIVEN: P= ₱500,000 R=4% T= MAY 10, 2004 – APRIL 22, 2016

    YEAR MONTH DAYS


    2016 2015 4/16 22
    2004 5 10
    11 11 12

    11*360 = 3,960
    11*30 = 330
    12 = 12
    4,302 APPROXIMATE TIME

    May 31 – 10 21
    June 30 11*366 = 4,026 + 348
    July 31 = 4,374 ACTUAL TIME
    August 31
    September 30
    October 31
    November 30
    December 31
    January 31
    February 29
    March 31
    April 22
    348
    Ie = ₱500,000 x .04 x 4374/366
    = ₱239,016.39 EXACT INTEREST

    Io = ₱500,000 x .04 x 4302/360


    = ₱239,000 ORDINARY INTEREST

    8. GIVEN: P =₱500,000 R=4% T= JULY 4, 2006 – DECEMBER 13, 2007

    YEAR MONTH DAYS


    2007 12 13
    2006 7 4
    1 5 9
    1*360 =360
    5*30 = 150
    9 = 9
    519 APPROXIMATE TIME

    July 31 – 4 27
    August 31
    September 30
    October 31
    November 30
    December 13
    162
    1*365 = 365 = 527 ACTUAL TIME

    Ie = ₱500,000 x .04 x 527/365


    = ₱28,876.71 EXACT INTEREST

    Io = ₱500,000 x .04 x 519/360


    = ₱28,833.33 ORDINARY INTEREST

    9. GIVEN:

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