What is the amount due?

Question

On January 12, 1998, Jack Southerland purchases a lot $48,000. He makes a partial payment of $10,000 once every 30 days, beginning February 11. On May 11, he plans to make the last payment plus the interest. If the rate of interest is 18%, what is the amount due? Use the Merchant's Rule.

Answer 1

Using the Merchant’s Rule on the following dates:

Jan 12 48000(1+0.18/3)=50880

Feb 11 less 10000(1+0.18/4)=-10450

Mar 11 less 10000(1+0.18/6)=-10300

Apr 10 less 10000(1+0.18/12)=-10150

May 10 less 10000=-10000

Total $9980 on May 11.