Question

Kamala borrowed Rs 26,400 from a Bank to buy a scooter at a rate of 15% p.a. compounded yearly. What amount will she pay at the end of 2 years and 4 months to clear the loan?

Answer 1

Amount after 1st year 26400 + 3960 = 30360
Amount after 2nd year 30360 + 4554 = 34914
To make things easier interest can be bifurcated into two parts of 10% and 5% as follows:
1st year 26400 + 2640 + 1320 = 30360
2nd year 30360 + 3036 + 1518 = 34914