ICSE Class 10 Maths Chapter 03 Banking

Chapter 3

Banking

Points To Remember

1. Calculating Interest is a Saving Bank Account:

For money kept in Saving Bank Account, the bank pays some interest. These days, the rate of interest is 4% p.a.

Rule. In a Saving Bank Account, the minimum balance from the 10th day of each month (in a multiple of 10) qualifies for the interest during that month.

2. Method of Calculating Interest:

(i) Write down the minimum balance from the 10th day of each month in a multiple of Rs. 10.

(ii) Add all these balances.

(iii) Find simple interest on this sum for 1 month.

Note. (i) If total interest is less than Re 1, take it zero.

(ii) If minimum balance in a month from 10th day is Rs. 5 or less, no interest is paid for that month.

3. Recurring Deposit (R.D.) or Commulative Time Deposits (C.T.D.)

We know that \((1 + 2 + 3 + \ldots + n) = \frac{n(n+1)}{2}\) - Formula for calculating S.I. when Rs. P per month is deposited for n months at R% p.a. = Rs. \(\left[P \times \frac{n(n+1)}{2} \times \frac{1}{12} \times \frac{R}{100}\right]\)

Note. We can also find the S.I. and amount payable after maturity using the tables for calculation R.D. There tables are given.

Exercise 3 (A)

Q. 1. Mr. S.K. Goswami has a Savings Bank Account with the Syndicate Bank. His pass book has the following entries.

Mr. Goswami closes his account on Oct. 20, 2005. Find the net balance, he gets from the bank, the interest being paid at 4% per annum.

Sol. Principal for the month of Jan., 2005 = Rs. 2800

Principal for the month of Feb., 2005 = Rs. 2800

Principal for the month of March, 2005 = Rs. 2800

Principal for the month of April, 2005 = Rs. 2800

Principal for the month of May, 2005 = Rs. 2800

Principal for the month of June, 2005 = Rs. 2800

Principal for the month of July, 2005 = Rs. 2800

Principal for the month of Aug., 2005 = Rs. 2800

Principal for the month of Sep., 2005 = Rs. 5200

Principal for the month of Oct., 2005 = nil

Total principal for one month = Rs. 27600

Rate of interest = 4% p.a.

Period = 1 month = \(\frac{1}{12}\) year

Total interest = \(\frac{P.R.T}{100} = \frac{27600 \times 4 \times 1}{100 \times 12}\) = Rs. 92

Net Balance to be paid = Rs. 3200 + Rs. 92 = Rs. 3292 Ans.

Q. 2. The entries in a Savings Bank Pass Book are as given below:

Calculate the interest for six months (January to June) at 4% p.a. on the minimum balance on or after the tenth day of each month.

Sol. Principal for the month of Jan. = Rs. 14000

Principal for the month of Feb. = Rs. 20500

Principal for the month of March = Rs. 20500

Principal for the month of April = Rs. 20000

Total principal for one month = Rs. 119500

Rate of interest = 4%

Total interest = \(\frac{Prt}{100} = \frac{119500 \times 4 \times 1}{100 \times 12}\)

= Rs. 398.33 Ans.

Q. 3. A page from the Savings Bank Account of Mrs. Rajni Sethi is given below:

If she closes the account on 2nd July, 2005, how much interest she will get from the bank at 4% p.a.?

Sol. Principal for the month of Jan., 2005 = Rs. 5200

Principal for the month of Feb., 2005 = Rs. 6700

Principal for the month of March, 2005 = Rs. 7900

Principal for the month of April, 2005 = Rs. 6900

Principal for the month of May, 2005 = Rs. 5500

Principal for the month of June, 2005 = Rs. 6500

Principal for the month of July, 2005 = nil

Total principal for one month = Rs. 38700

Rate = 4% p.a.

Period = 1 month = \(\frac{1}{12}\) years.

Interest = \(\frac{P.R.T}{100} = \frac{Rs.38700 \times 4 \times 1}{100 \times 12}\) = Rs. 129 Ans.

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