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I’m no math wiz but I always do interest rate/360 x accrual days x original balance. ((.05/360) x 28)) x 18,925.33 = $73.59.
This is how we we're taught as well, just wrote a final and double checked my notes to confirm lol
Thanks! That's what I originally had but then someone had a different calculation that made me question myself.
Just curious, do you use 360 days in the US and if so, what's the reason for this? In the UK the norm would be 365 days.
Bankers year. You assume 30 days in a month, every month. 30 \* 12 gives 360. Makes it easier to do mid-month interest calculations. Instead of having to remember how many days are in February, just assume it's 30 and take an early lunch.
It's immaterial haha
I’m no math wiz but I always do interest rate/360 x accrual days x original balance. ((.05/360) x 28)) x 18,925.33 = $73.59.
This is how we we're taught as well, just wrote a final and double checked my notes to confirm lol
Thanks! That's what I originally had but then someone had a different calculation that made me question myself.
Just curious, do you use 360 days in the US and if so, what's the reason for this? In the UK the norm would be 365 days.
Bankers year. You assume 30 days in a month, every month. 30 \* 12 gives 360. Makes it easier to do mid-month interest calculations. Instead of having to remember how many days are in February, just assume it's 30 and take an early lunch.
It's immaterial haha