Unless the interest is compounded monthly, in which case the amount would be approximately $244.08. Compounded daily it would be something like $244.28.
So given that the period is unspecified I would accept $240 as the correct order-of-magnitude estimate. The error introduced by ignoring compounding over this period is never more than two percent, which is fine for a mental computation and adequate to check whether your accountant is robbing you blind. (Robbing you subtly requires a more detailed audit, of course.)
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timeasmymeasure
no subject
Date: 2008-04-12 05:52 am (UTC)Unless the interest is compounded monthly, in which case the amount would be approximately $244.08. Compounded daily it would be something like $244.28.
So given that the period is unspecified I would accept $240 as the correct order-of-magnitude estimate. The error introduced by ignoring compounding over this period is never more than two percent, which is fine for a mental computation and adequate to check whether your accountant is robbing you blind. (Robbing you subtly requires a more detailed audit, of course.)