48. What is the amount of $250 dollars, at 54 per cent, Ans. $263,75cts: for one year? 2)250 dollars. 49. What is the amount of 1000 dollars for two years, at 61 per cent? Ans. $1125. 50. What is the amount of 500 dollars for four years, at 53 per cent? Ans. $615. 51. What is the amount of 750 dollars for 5 years, at 61 per cent? Ans. $993,75cts. To calculate interest on notes, bonds, &c. on which partial payments have been made. The following Rule is established for the practice of the Courts in the State of New York: RULE I." The Rule for casting Interest, where partial pay. ments have been made, is to apply the payment, in the first place, to the discharge of the interest then due. If the payment exceeds the interest, the surplus goes towards discharging the principal, and the subsequent interest is to be computed on the balance of principal remaining due. If the payment be less than the Interest, the surplus of Interest must not be taken to augment the principal, but Interest continues on the former principal until the period when the payments, taken together, exceed the Interest due, and then the surplus is to be applied towards discharging the principal; and Interest is to be computed on the balance of principal as aforesaid." (Johnson's Chancery Reports, Vol. I. page 17.) This Rule is founded on the following principles: 1st. That Interest is due whenever a payment is made, if the payment is equal to the interest to that time. If the payment is not es qual to the Interest, the payment is to be added to the following payment or payments, until their sum equals or exceeds the Interest accrued, and then the balance forms a new principal. 2nd. Interest is not allowed on endorsements, because payments first go to the discharge of the Interest due, and the surplus towards the extinction of the debt. 3rd. Interest cannot be taken on Interest, nor go to augment the principal, because the Interest is due when the payment or payments are made; and our courts will not sustain an action for the payment of Interest from year to year, unless the express condition is contained in the obligation, that the Interest shall be paid annually. EXAMPLES. 1. Suppose you have a bond against B for 1000 dollars; dated May 15th 1821, upon which you find the following endorsements, viz: 1. September 20th 1822. Recd. $150,60cts. 1 y. What remained due upon the bond May 20th 1829? Interest to be cast at 7 per cent. Ans. $869,19cts. 9m. The periods of time from one date to another may be found by subtracting the date of the bond or note from the time when the first payment was made, and so on, subtracting the time of one payment from the next, till the time of settlement. In setting down the date to obtain the time, first set down the year, then the months that have fully passed in that year, and then the days that have passed in the month named; then in the operation reckon 30 days to the month, and 12 months to the year; thus, $1000 Principal. y. mo. d. 4 5 94,30,5 Int. to the first endorsment, being 1 1093,30,5 Am't. due, at the time the 1st. pay't. was made: 150,60 1st. payment deducted. 943,70,5 Principal remaining due, Sept. 20, 1822. 1082,24,6 Am't. at the time of the 2d payment. 881,34,6 Principal remaining due, Oct. 25, 1824. $105,56,5 In. ex'ds. the p't. July 11, 1826. 73,51,8 In. to Sept. 20, 1827, upon same 179,08,3 sum of the Int's. [principal. 179,08,3 1060,42,9 Amount. 75,20 112,11 [Sept. 20, 1827. 187,31 Sum of the third and fourth payments deducted 873,11,9 Principal remaining due, Sept. 20, 1827. 950,36,5 Amount to December 25th 1828. 845,36,5 Principal remaining due, Dec. 25, 1828. $869,19,9 Balance due May 20, 1829. 2. A note was given, April 20th 1825, of $800,50cts. ; May 25th 1826, $250 were endorsed; and Dec. 20th 1828, $300 were endorsed; what was due on the note, June 20th 1829; Interest at 7 per cent? Ans. $436,82cts. 4m. 3. A note was given April 15th 1824, of $1200, upon which the following payments were made, viz: April 15th 1826, Rec'd. $400, Sept 20th 1827, Rec'd. $350, 20cts. What amount remained due on the note Sept. 20 1828; Interest 7 per cent ? Ans. $764,76cts. 4m. 4. Suppose a bond or note dated July 10, 1825, was given for $450, interest at 7 per cent, on which was the following endorsement: Nov. 20th 1827, Rec'd. $200; what remained due Sept. 10th 1829 ? Ans. $365,37cts. 2m. 5. A note was given for $600, dated Jan. 15, 1826, and there were payments endorsed upon it as follows, viz: April 20th 1827, Rec'd. 300 dollars, May 15th 1828 Received 200 dollars; what remained due May 10th 1829; Interest at 7 per cent? Ans. $191,90cts. The following Rule was established by the Superiour Court of Connecticut in 1784. RULE II" Compute the interest to the time of the first payment, if that be one year or more from the time the interest commenced, add it to the principal, and deduct the payment from the sum total. If there be after payments made, compute the interest on the balance due to the next payment, and then deduct the payment as above; and, in like manner from one payment to another, till all the payments are absorbed; provided, the time between one payment and another be one year or more. But if any payment be made before one year's interest hath accrued, then compute the interest on the principal sum due on the obligation for one year, add it to the principal; and compute the interest on the sum paid, from the time it was paid, up to the end of the year; add it to the sum paid, and deduct that sum from the principal and interest added as above. If any payment be made of a less sum than the interest arisen at the time of such payment, no interest is to be computed, but only on the principal sum, for any period.”—Kirby's Reports, page 49. This Rule is founded on the following principles: 1. That, when obligations have run on interest for 1 or more years, interest is not due at intervals of time less than one year. 2. If an endorsement be made after one year's interest has accrued, but which is less than the interest at the time of such endorsement, then the endorsement shall not bear interest like endorsements made before a year's interest has become due. 3. Instead of computing interest to the end of the year when a payment has been made before one year's interest has accrued, compute the interest on the principal to that endorsement, which, together with the preceding endorsement or endorsements and its, or their interest since the time of payment, shall be equal to or exceed the interest on the principal when this endorsement is made;* deduct the payment or payments and the interest thereof from the amount of the principal, and the difference is a new principal, on which interest is to be computed as before. * If a payment is made after one year's interest has accrued, no interest is to be reckoned on such payment. NOTE.-Legal interest in the New England States, is 6 per cent. 1. Suppose a note was given on demand for 1000 dollars, dated February 1st. 1825. On which were the following endorsements. 1. April 1, 1826, Received, $80. What was the balance due on the note, October 1, 1828, cent? at 6 per Ans. $263,93cts. 70 Int to the 1st. end't., being 1 year and 2 months. 1070 Amount. 80 1st. Endorsement. 990 Principal remaining due April 1, 1826. 99 Int. to the 4th end't., being 1 year and 8 months. 1089 Amount to the 4th endorsement. 30 2nd. Endorsement. 2,40 Interest to the 4th endorsement. 32,40 10, 600, 3d. End. which does not bear interest because 1 642,40 Deduct from 1089 dollars.. 446,60 Principal remaining due, Dec. 1, 1827. 200 5 205 5th Endorsement. Interest to Oct. 1, 1828, being 5 months. $263,93 cents. Balance due October 1, 1828. 2. Suppose a bond or note dated May 10, 1824, was given for 2000 dollars, interest at 6 per cent, upon which were the following endorsements, viz: 1. March 10, 1825, Received, 2. May 10, 1826. .... 3. September 10, 1827. $800. 400. 300. Ans. $823,73 cents 7 mills. .... What remained due January 10, 1829? See 3d. Note under the preceding General Rule: this 2. example 3 worked according to the Note referred to. |