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Determine how much interest was charged

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Question: McKenzie Wood Products negotiated a $200,000 revolving line of credit with the Bank of Montreal at prime plus 2%. On the twentieth of each month, interest is calculated (up to but not including the twentieth) and deducted from the company's chequing account. If the initial loan advance of $20,000 on July 3 was followed by a further advance of $40,000 on July 29, how much interest was charged on July 20 and August 20? The prime rate was at 4% on July 3 and fell to 2.75% on August 5. (Round your answer to two decimal places.)

The amounts of interest charged on July 20 and August 20 were $ and $ respectively.

Reference no: EM132767693

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