Calculate The Due Simple Flat Rate Interest Earned by a Principal of 40,000.00 (Dollar, Euro, Pound, ...), 2.00% Annual Interest Rate, for a Period With The Duration of 3 years

Calculation method used. Calculation formula. Used notations


[1] Calculation method used: 30 / 360

Number of days in a month = 30

Number of days in a year = 360


[2] Simple interest, I
Calculation formula:

I =

(P × r × t) ÷ 360


I = Simple interest amount

360 = Number of days in a year

P = Principal (initial amount)
P = 40,000.00 units (Dollar, Euro, Pound, etc.)

r = Annual simple interest rate, r = 2.00%

t = Duration of the investment, in days
t = 3 years

t =

+ 3 years × 360 days / year

t = 1,080 days



>> Simple Interest: what is it, how is it calculated?


Calculate the simple interest amount

[3] Substitute for the values
in the Simple Interest formula:

I =

(P × r × t) ÷ 360 =

(40,000.00 × 2.00% × 1,080) ÷ 360 =

40,000.00 × 2.00 ÷ 100 × 1,080 ÷ 360 =

(40,000.00 × 2.00 ÷ 100) × (1,080 ÷ 360) =

(80,000.00 ÷ 100) × 3 =

800 × 3 =

2,400.00


[4] V = Amount earned:

V = P + I =

40,000.00 + 2,400.00 =

42,400.00


[5] Project Breakdown. Monthly.

The simple interest is evenly distributed
along the months that make up the project

Month Days Interest Total
interest 		Balance
0 0 -- -- 40,000.00
1 30 66.67 66.67 40,066.67
2 30 66.67 133.33 40,133.33
3 30 66.67 200.00 40,200.00
4 30 66.67 266.67 40,266.67
5 30 66.67 333.33 40,333.33
6 30 66.67 400.00 40,400.00
7 30 66.67 466.67 40,466.67
8 30 66.67 533.33 40,533.33
9 30 66.67 600.00 40,600.00
10 30 66.67 666.67 40,666.67
11 30 66.67 733.33 40,733.33
12 30 66.67 800.00 40,800.00
13 30 66.67 866.67 40,866.67
14 30 66.67 933.33 40,933.33
15 30 66.67 1,000.00 41,000.00
16 30 66.67 1,066.67 41,066.67
17 30 66.67 1,133.33 41,133.33
18 30 66.67 1,200.00 41,200.00
19 30 66.67 1,266.67 41,266.67
20 30 66.67 1,333.33 41,333.33
21 30 66.67 1,400.00 41,400.00
22 30 66.67 1,466.67 41,466.67
23 30 66.67 1,533.33 41,533.33
24 30 66.67 1,600.00 41,600.00
25 30 66.67 1,666.67 41,666.67
26 30 66.67 1,733.33 41,733.33
27 30 66.67 1,800.00 41,800.00
28 30 66.67 1,866.67 41,866.67
29 30 66.67 1,933.33 41,933.33
30 30 66.67 2,000.00 42,000.00
31 30 66.67 2,066.67 42,066.67
32 30 66.67 2,133.33 42,133.33
33 30 66.67 2,200.00 42,200.00
34 30 66.67 2,266.67 42,266.67
35 30 66.67 2,333.33 42,333.33
36 30 66.67 2,400.00 42,400.00
Month Days Interest Total
interest 		Balance

Answer:

Principal (initial amount) = 40,000.00

Amount earned = 42,400.00

Simple interest amount = 2,400.00


Calculate simple flat rate interest on a principal borrowed, lent

Simple Interest Amount = (Principal × Annual Simple Interest Rate × Duration in days) ÷ Number of days in a year

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