Sandra Gloy borrowed $5,000 on a 120-day 5% note. Sandra paid $500 toward the note on day 40. On day 90 she paid an additional $500. Using the U.S. Rule, her adjusted balance after the first payment is:

Note: It is a legal instrument in which one party (usually the creditor) promises the other party (lender) in writing that he/she will pay the particular amount of money at a fixed or after a particular time to the lender at a fixed rate of interest. It is a debt instrument without any collateral attached to it. These are used to pay meet the short term requirements of the creditor.

Compute the adjusted balance after first payment:

[tex]\begin{aligned}\text{Adjusted Balance after 40 Days}&=\text{Principal Amount-Amount Paid after 40 days}\\&\text{+Interest for 40 days}\\&=\$5,000+\$500+\$27.39\\&=\$4,527.39\end{aligned}[/tex]

Therefore, the adjusted balance after the first payment is $4527.39.

Working Note:

Compute the interest on note for 40 days:

[tex]\begin{aligned}\text{Interest\:on\:Note\:for\:40\:days}&=\$5,000\times\dfrac{5}{100}\times\dfrac{40}{365}\\&=\$27.39\end{aligned}[/tex]

Learn More:

1. Learn more about the lifetime cost of the loan along with interest

https://brainly.com/question/1757741

2. Learn more about the interest on credit card

https://brainly.com/question/5993991

3. Learn more about compound interest

https://brainly.com/question/1033449

Answer details:

Grade: Senior School

Subject: Finance

Chapter: Money Market Instruments

Keywords: 5% note, payment after 40 days, of $500, and $500 after 90 days, adjusted, balance of to be paid, after, first payment, according to US rule, particular amount of money, at fixed rate, interest rate, fixed, legal instrument, creditor, lender, debtor, promises, in writing, debt instrument, without collateral attached, to meet short term, requirements, of, creditors.