Business math thread.

[Keki]

Okay, so I've spent about 30mins to 1 hour trying to figure this question out and it's driving me to the edge of insanity!!!!

Chapter 21B - Question 3: An account is opened with an initial deposit of $5525 on 1 April. On 24 APril $500 is withdraw. On 26 May a deposit of $175 is made. If no other transactions are made, find the amount of interest earned from 1 April until 30 June, if the accounts pays 6% per annum on the minimum monthly balance.

This how I tried to tackle the question

1 April - Initial deposit/Opening - Balance - $5525
24 April - $500 withdrawn - Balance - $5025

1 April to 24 April = 24 days
Interest = (24/365) x (6/100) x 5525
21.80
25 April to 26 May = 31 days
Interest = (31/365) x (6/100) x 5025
25.61
27 May to June 30 = 34 days
Interest = (34/365) x (6/100) x 5200
29.06

Total Interest = 21.80+25.61+29.06
= $76.47
Answer= $76.25

There's 30 days in April and June, and 31 in May. The number of days I've used only adds up to 89 days. What am I doing wrong? If a question like this comes up on the exam I'm going to smash my head on the desk!!!

[MJRomeo81]

Minimum monthly balance (your steps look like minimum daily balance):
 
Rate for this question = 6 /12 = 0.5%

Min balance throughout April = 5525 - 500 = 5025

Month of April:
5025 X 0.5 X 1 / 100 = 25.12

Month of May:
5025 X 0.5 X 1 / 100 = 25.12

Month of June:

5200 (the lowest it possibly was in june) X 0.5 X 1 / 100 = 26

Total = (25.12 X 2) + 26 = 76.24 (excuse my rounding)

[_avO]

Calculated monthly so ignore transactions during the month til the end

April                        May                     June
(5025*.06/12)    + (5025*.06/12)  +(5200*.06/12) = 76.25.

Gl on the exams buddy

[Keki]

Omg.. Thank you! It's so hard to differ from a state of mind where you think you're on the right track when you're not! I assumed that the rate was for a month and it would of taken a while before coming to the answer. Thank youuuuuuuuuu once again :d