PROMISORY-NOTE-Mathematics-on-Investment.pdf

All about promissory note

1. PROMISORY NOTE

2. PROMISORY NOTES

» A promissory note is a written promise
on the part of the borrower to pay
another person for his financial
obligation.

» It includes the agreed interest or
discount rate and term.

3. TYPES OF
PROMISSORY

NOTES

|
| | |

SIMPLE BANK
INTEREST DISCOUNT
NOTE

NOTE

4. SIMPLE INTEREST NOTE

>It is a promissory note where the
principal, P, is explicitly written.

» It is better referred to as the face
value of the loan.

» The total amount to be repaid on the
maturity date is the maturity value, F.

5. BANK DISCOUNT NOTE

» It is an often used promissory note where the
maturity value, F, is explicitly written.

» It is the amount to be paid by the borrower.

» The interest is computed on this amount and
deducted in advance.

» The sum of the money received by the maker
is called proceeds, P.

6. SIMPLE INTEREST NOTE

100, 000.00 IPIL, PHILIPPINES SEPTEMBER 9, 2025

One hundred twenty days after the above date, the
undersigned promises to pay to the order of Catherine nt
Conahap the sum of one hundred thousand pesos only
(100,00.00) with interest at 15% per annum payable at LS
North West Pastil Banking Corporation, Ipil. | DA

Signed: John Conahap

y

7. SIMPLE INTEREST NOTE

SEPTEMBER -
OCTOBER -
NOVEMBER -
DECEMBER -
JANUARY -

120 DAYS

8. SIMPLE INTEREST NOTE

I=PRT
| = (100,000)(.15)(
| = 5,000

120
360

)

9. SIMPLE INTEREST NOTE

F=P+|
F = 100,000 + 5,000
F = 105,000

10. BANK DISCOUNT NOTE

150, 000.00 IPIL, PHILIPPINES SEPTEMBER 9, 2025 =
One hundred fifty days after the above date, for the a
value received with interest at 10% per annum
discounted to maturity, the undersigned promises to pay
to the order of Moner Pastil Business Agency, the sum of PS
one hundred fifty pesos only (150,000) payable at Moner

Pastil Business Agency. aw

Signed: Cristian Villar

y

11. BANK DISCOUNT NOTE

SEPTEMBER -
OCTOBER -
NOVEMBER -
DECEMBER -
JANUARY -
FEBRUARY -

150 DAYS

12. N 4

13. BANK DISCOUNT NOTE

P=F-|
P = 150,000 - 6,250
P = 143,750

14. 1. The maturity value of six-month simple interest n
was P33,000. If the interest rate was 18% per ye
what is the face value of the note?

2.A simple interest note for P80,000 at 16% per annu
was signed for 102 days. Find the maturity value.

3. Ellavia signed a P62,000 bank discount note at 10%. If
the proceeds was 60,000, what was the term of the
note?

4. A bank discount note for 180,000 at 8% has a term of,
9 months. Find the interest charged in advance al
the proceeds.