FUNDAMENTALS OF BUSINESS MATHEMATICS AND STATISTICS I 1.35Alternatively, the same can also be calculated as : ‘0’ Date = 1.1.2012
Computation of Average Due Date
Starting date Due Date Amount No. of months from Product
` Jan. 1
(1) (2) (3) (4) (5)
Jan. 1 2012 Feb. 1 2012 600 1 600
Jan. 1 2012 March 1 2012 600 2 1,200
Jan. 1 2012 April 1 2012 600 3 1,800
Jan. 1 2012 May 1 2012 600 4 2,400
Jan. 1 2012 June 1 2012 600 5 3,000
3,000 9,000
Average =9,000
3,000
`
` = 3 months
∴ Average due date is 3 months from Jan. 1. i.e., Jan 1 + 3 months = April 1.
Interest chargeable @ 10% on ` 3,000 for 3 months (April 1 to June 1) should be calculated
That is, interest will be = ` 3,000 x 100 1210 3× = ` 75.Example 52 :
X accepted the following bills drawn by his creditor Y :
Feb. 10 for 4,000 at 3 months. March 15 for 5,000 at 3 months.
April 12 for 6,000 at 3 months. May 8 for 5,000 at 5 months.
On 1st June it was decided that X would withdraw all such bills and he should accept on that day two bills,
one for ` 12,000 due in 3 months and the other for the balance for 5 months.
Calculate the amount of the second bill after taking into consideration that rate of interest is @ 10% p.a.
Ignore days of grace.
Solution:
Take May 10 as ‘0’ date; the following table is prepared on that basis :
Compution of Average Due Date ‘0’ Date = 1.5.2012
Date of Drawing Periods Due Date of the Amount No. of days from’0’date Product
original bills
` `
Feb. 10 3 May 10 4,000 0 0
March 15 3 June 15 5,000 36 (21 + 15) 1,80,000
April 12 3 July 12 6,000 33 (21 + 12) 1,98,000
May 8 5 Oct. 8 5,000 151 (21+30 + 31+31+30 + 8) 7,55,000
20,000 11,33,000