$500. PHILADELPHIA, Feb. 1, 1861. 7. For value received, I promise to pay J. B. Lippincott & Co., or order, five hundred dollars three months after date, with interest. JAMES MONROE. Indorsed as follows: May 1, 1861, $40; Nov. 14, 1861, $8; April 1, 1862, $12; May 1, 1862, $30. How much was due Sept. 16, 1862 ? Ans. $155.57+. 544. CONNECTICUT RULE.* I. Payments made one year or more from the time the interest commenced, or from another payment, and payments less than the interest due, are treated according to the United States rule. II. Payments exceeding the interest due and made within one year from the time interest commenced, or from a former payment, shall draw interest for the balance of the year, provided the interval does not extend beyond the settlement, and the amount must be subtracted from the amount of the principal for one year; the remainder will be the new principal. III. If the year extend beyond the settlement, then find the amount of the payment to the day of settlement, and subtract it from the amount of the principal to that day; the remainder will be the sum due. 545. A note containing a promise to pay interest annually is not considered in law a contract for any thing more than simple interest on the principal. For partial payments on such notes the following is the VERMONT RULE. I. Find the amount of the principal from the time interest commenced to the time of settlement. II. Find the amount of each payment from the time it was made to the time of settlement. III. Subtract the sum of the amounts of the payments from the amount of the principal; the remainder will be the sum due. *The United States rule is in general use. 546. In New Hampshire interest is allowed on the annual interest if not paid when due, in the nature of damages for its detention; and if payments are made before one year's interest has accrued, interest must be allowed on such payments for the balance of the year. Hence the following NEW HAMPSHIRE RULE. I. Find the amount of the principal for one year, and deduct from it the amount of each payment of that year, from the time it was made up to the end of the year; the remainder will be a new principal, with which proceed as before. II. If the settlement occur less, than a year from the last annual term of interest, make the last term of interest a part of a year, accordingly. $1000. EXAMPLES FOR PRACTICE. NEW HAVEN, CONN., Feb. 1, 1856. 1. Two years after date, for value received, I promise to pay to Peck & Bliss, or order, one thousand dollars with interest. JOHN CORNWALL. Indorsed as follows: April 1, 1857, $80; Aug. 1, 1857, $30; Oct. 1, 1858, $10; Dec. 1, 1858, $600; May 1, 1859, $200. How much was due Oct. 1, 1859? Ans. $266.38. $2000. BURLINGTON, VT., May 10, 1858. 2. For value received, I promise to pay David Camp, or order, two thousand dollars, on demand, with interest annually. RICHARD THOMAS. On this note were indorsed the following payments: March 10, 1859, $800; May 10, 1860, $400; Sept. 10, 1861, $300. How much was due Jan. 10, 1863 ? 3. How much would be due on the above note, computing by the Connecticut rule? Ans. $831.58. 4. How much, computing by the New Hampshire rule? By the United States rule? Ans. N. H. rule, $833.21; U. S. " $831.90. SAVINGS BANK ACCOUNTS. 547. Savings Banks are institutions intended to receive in trust or on deposit, small sums of money, generally the surplus earnings of laborers, and to return the same with a moderate interest at a future time. 548. It is the custom of all savings banks to add to each depositor's account, at the end of a certain fixed term, the interest due on his deposits according to some general regulation for allowing interest. The interest term with some savings banks is 6 months, with some 3 months, and with some 1 month. 549. A savings bank furnishes each depositor with a book, in which is recorded from time to time the sums deposited and the sums drawn out. The Dr. side of such an account shows the deposits, and the Cr. side the depositor's checks or drafts. In the settlement, interest is never allowed on any sum which has not been on deposit for a full interest term. Hence, to find the mount due on any depositor's account, we have the following RULE. At the end of each term, add to the balance of the account one term's interest on the smallest balance on deposit at any one time during that term; the final balance thus obtained will be the sum due. NOTES. 1. It will be seen that by this rule no interest is allowed for money on deposit during a partial term, whether the period be the first or the last part of the term. 2. An exception to this general rule occurs in the practice of some of the savings banks of New York city. In these, the interest term is 6 months, and the depositor is allowed not only the full term's interest on the smallest balance, but a half term's interest on any deposit, or portion of a deposit made during the first 3 months of the term, and not drawn out during any subsequent part of the term. EXAMPLES FOR PRACTICE. 1. What will be due April 20, 1860, on the following account, interest being allowed quarterly at 6 per cent. per annum, the terms commencing Jan. 1, April 1, July 1, and Oct. 1? Dr. Savings Bank in account with James Taylor. Cr. 1858, Jan. 12,......... $75 1858, March 5,......... $30 May 10, 150 1859, Feb. 16,......... 130 Aug. 16,...... 50 Least balance during the current term,........................ 119 87 Int. on $119.87, for 3 mo................. 1.80 $121.67 130.00 1.83 Bal. due after Apr. 1, 1860,................................$253.50 Ans. NOTE.-In the following examples the terms commence with the year, or on Jan. 1. 2. Allowing interest monthly at 6 % per annum, what sum will be due Sept. 1, 1860, on the book of a savings bank having the following entries? Bay State Savings Institution, in account with Jane Ladd. 3. Interest at 7 %, allowed quarterly, how much was due April 4, 1860, on the following savings bank account? Detroit Savings Institution, in account with R. L. Selden. Cr. 50 36 4. How much was due Jan. 1, 1860, on the following account, allowing interest semi-annually, at 6 % per annum? Dr. Irvings Savings Institution, in account with James Taylor. Cr. 5. Interest at 5 %, allowed according to Note 2, how much was due, Jan. 1, 1860, on the book of a savings bank in the city of New York, having the following entries? Sixpenny Savings Bank, in account with William Gallup. Dr. Cr. 550. Compound Interest is interest on both principal and interest, when the interest is not paid when due. NOTE. The simple interest may be added to the principal annually, semiannually, or quarterly, as the parties may agree; but the taking of compound interest is not legal. 1 What is the compound interest of $640 for 4 years, 15 per cent.? |
