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Sunlight Growers borrows $\$ 250,000$ from a bank at a 4$\%$ annual interest rate. The loan is due in three months. At the end of the three months, the company pays the amount due in full. How much did the company remit to the bank?A. $\$ 250,000$B. $\$ 10,000$C. $\$ 252,500$D. $\$ 2,500$

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Chapter 12

Current Liabilities

Section 4

Prepare Journal Entries to Record Short-Term Notes Payable

The Real Economy in the Long Run

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Okay, so we're given that a couple they want to have are actually, um, company must pay three year old seven. So those are all settlement in three years. So this is their amounts that they have to pay, and they want to pay it in three years. So that means our T values. And now for part A. Whereas what amount must be deposited at debates of 0.6 just 6%? Andi, we're compounding semi annually. So that's em is equal to to have enough Ford a settlement. So we're basically solving for our present value. They're of a is equal to p times the falling and I would sell for P. Soapy is able to a over what we have here. And now let's plug in what we have. So we have 30700 over one plus our that serpent 06 over to the power of two times three, two times three is six. And now all of this into my calculated. Okay, so days. So we see that we have to have What starting rally are present value of 25,000 and 710 points 77 Okay. I know. For a part, B were asked how much interest will be earned. Okay, So our formula for interest that that's equal to P is equal to or Sorry, that's I people to p rt. So we have a principle of 25710.77 times a rate of 0.6 and a year of three. So that gives us an interest of 40 for a day or four. 4627 points in 94. Okay. And on to our next question, we'll feed deposits. 200,000 to that is P is equal to 200,000. Um, how much more will be needed in three years? Okay, so let's plug in what we have. We have 30 seven, and then zeros. Old girl is equal to 2000 or 200,000 and then we have one plus R 0.6 over, um, to the power of Okay, so we're also given that are mbali is too, and rash actually saw them for a value. We have a and then, um, is to and into the times today. So plugging that into my calculator. I get, um 238810.4 six and were asked how much more we need in three years. So we wanted this amount. So we'll subtract that from what we currently have. Okay, so we see that we have approximately six 81895.54 that we need remaining after three years. Okay. And now, if reports d were asked if a We have a present value of 200,000 on intercom pounding continuously so we have the formula is equal to P e r T. What is the interest rate that would accumulate if we have is 30700 So and our time is three years. So we're solving for our which is our interest rate. Okay, so we have to be sterile Sevens. It was so divided by 200,000. So we get 1.535 is equal to he. We are taking the natural audible sides and in dividing by three, we get that or is able to Poland of 1.5 3 5/3 And that gives us approximately ports are zero points through a 0.14 to 8

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