SOLVED PROBLEMS IN SIMPLE INTEREST

1.) IF YOU BORROWED MONEY FROM YOUR FRIEND WITH SIMPLE INTEREST OF 15%, FIND THE
PRESENT WORTH OF P30,000, WHICH DUE AT THE END OF 7 MONTHS.
SOLUTION:
𝐹 =𝑃+𝐼
𝐹 = 𝑃 + 𝑃𝑟𝑡
7
30,000 = 𝑃 + 𝑃(0.15) ( )
12
𝑃 = 𝑃27586.21

2.) A PRICE TAG OF P1,500.00 IS PAYABLE IN 60 DAYS BUT IF PAID WITHIN 30 DAYS IT WILL
HAVE A 3% DISCOUNT. FIND THE RATE OF INTEREST.
SOLUTION:
𝐷𝑖𝑠𝑐𝑜𝑢𝑛𝑡 = 0.03(1,500.00) = 45
𝐴𝑚𝑜𝑢𝑛𝑡 𝑡𝑜 𝑏𝑒 𝑝𝑎𝑖𝑑 𝑜𝑛 30 𝑑𝑎𝑦𝑠 = 1,500.00 − 45 = 1,455.00
𝐼 = 𝑃𝑟𝑡
30
45 = 1,145.00(𝑟) ( )
360
𝑟 = 0.472 = 47.2% (𝑟𝑎𝑡𝑒 𝑜𝑓 𝑖𝑛𝑡𝑒𝑟𝑒𝑠𝑡)

3.) A BANK CHARGES 15% SIMPLE INTEREST ON A P500.00 LOAN. HOW MUCH WILL BE
REPAID IF THE LOAN IS PAID BACK IN ONE LUMP SUM AFTER THREE YEARS?
SOLUTION:
𝐹 = 𝑃 + 𝑃𝑟𝑡
𝐹 = 500 + 500(0.15)(3)
F = P725.00
4.) A DEPOSIT OF P100,000 WAS MADE FOR 31 DAYS. THE NET INTEREST AFTER DEDUCTING
20% WITHHOLDING TAX IS P1000. FIND THE RATE OF RETURN ANNUALLY.
SOLUTION:
𝑁𝑒𝑡 𝐼𝑛𝑡𝑒𝑟𝑒𝑠𝑡 = 1000
1000
𝐺𝑟𝑜𝑠𝑠 𝐼𝑛𝑡𝑒𝑟𝑒𝑠𝑡 = = 1250 (𝑏𝑒𝑓𝑜𝑟𝑒 𝑑𝑒𝑑𝑢𝑐𝑡𝑖𝑛𝑔 20% 𝑡𝑎𝑥)
0.80
𝐼 = 𝑃𝑟𝑡
100000(𝑟)(31)
1250 =
360
𝑟 = 0.145 = 14.5%

5.) On Feb 3, 2020, Mr. Viaña made loan of P254,100.00 from Deter Bank. Said loan
shall paid in full on Sep 29 of the same year. Determine the accumulated amount if
the rate of interest is 8%.

Feb 3 – 29 = 26 days
Mar = 31
Apr = 30
May = 31
Jun = 30
Jul = 31
Aug = 31
Sep 29 = 29
Total = 239

I = Pni = 254,100.00 X 239/366 X 0.08 = P13,274.30

F = P + I = P254,100 + 13,274.30 = P267,374.30

6.) Today, March 22, 2021, the Soony Inc. made a deposit at the International bank in
the amount of P130,400 for the purchase of new equipment. The savings account
has an interest of 12% and the money shall be withdrawn on October 22, 2021. How
much is the exact simple interest of the deposit upon withdrawal?

Mar 22 – 31 =9
Apr = 30
 May = 31
Jun = 30
Jul = 31
Aug = 31
Sep = 30
Oct 22 = 22
Total = 214

I = Pni = 130,400.00 X 241/365 X 0.12 = P10,331.97

F = P + I = P254,100 + 13,274.30 = P267,374.30

7.) A loan of P65,000.00 was made for the period Jan 19 to August 28, 1986. If the rate
of interest is 7.5%, how much is the future amount using exact simple interest?

Jan 19 – 31 = 12
Feb = 28
Mar = 31
Apr = 30
May = 31
Jun = 30
Jul = 31
Aug 28 = 28
Total = 221

I = Pni = 65,000.00 X 221/365 X 0.75 = P22,137. 84

F = P + I = P65,000.00 + 22,137.84 = P87,137.84

8.) A MAN BORROWED FROM A BANK UNDER A PROMISSORY NOTE THAT HE SIGNED IN THE
AMOUNT OF P30,000.00 FOR A PERIOD OF ONE YEAR. HE RECEIVED ONLY THE AMOUNT
OF P21,000.00 AFTER THE BANK COLLECTED THE ADVANCE INTEREST AND AN
ADDITIONAL AMOUNT OF P85.00 FOR NOTARIAL AND INSPECTION FEES. WHAT WAS THE
RATE OF INTEREST THAT THE BANK COLLECTED IN ADVANCE ?
SOLUTION:
𝐼𝑛𝑡𝑒𝑟𝑒𝑠𝑡 = 30,000 − (21000 + 85) = 8915
𝐴𝑚𝑜𝑢𝑛𝑡 ℎ𝑒 𝑎𝑐𝑡𝑢𝑎𝑙𝑙𝑦 𝑟𝑒𝑐𝑒𝑖𝑣𝑒𝑑 = 30,000 − 8915 = 21,085
 8915
𝑅𝑎𝑡𝑒 𝑜𝑓 𝐼𝑛𝑡𝑒𝑟𝑒𝑠𝑡 = 𝑥100
21,085
𝑅𝑎𝑡𝑒 𝑜𝑓 𝐼𝑛𝑡𝑒𝑟𝑒𝑠𝑡 = 42.28%

9.) A man borrowed money from Bebe Lending Investor in the amount of P35,500. After
200 days he is ready to pay and Bebe Lending Investor asked him to pay the amount
of P51,278.00 as full payment including the interest. What is the rate of interest use
in this ordinary simple interest loan?

Amount of interest = 51,278.00 – 35,500

= 15,777.78

I = Pni
P15,777.78 = 35,500.00 X 200/360 X i

i = 15,777.78 / 19,722.22 = .8000 or 80% rate of interest

F = P + I = P35,500.00 + 15,777.78 = P51,278.00

10.) If Monica borrowed money from Leila with a simple interest of 15%, find
the present worth of P50,000, which is due at the end of 7 months.

𝐹 = 𝑃 + 𝑃𝑛𝑖
7
50,000 = 𝑃 + 𝑃 ( ) (0.15)
12
𝑷 = 𝟒𝟓, 𝟗𝟕𝟕. 𝟎𝟏