Split Fund Interest with Principal of 4000 and Fund 1 = 10% and Fund 2 = 15% and Interest Paid = 430
An investment of 4000 was made one year ago. Part of the investment was placed into an account paying s interest at 10% The remainder of the investment was placed into an account paying s interest at 15% After one year, you received a total of 430 in interest. How much was invested in each account?
Calculate Principal Amounts for each fund:
For Fund 1, we invest an unknown amount, let us call it x For Fund 2, the remaining principal is 4000 - x
Calculate Interest Credit for Fund 1
Since Fund 1 credits interest using the simple interest method, we have 0.1x
Calculate Interest Credit for Fund 2
Since Fund 2 credits interest using the simple interest method, we have 0.15(4000 - x)
Set up a grid with fund details:
Interest Paid
Principal
Interest
Rate
Fund 1
0.1x
x
10%
Fund 2
0.15(4000 - x)
(4000 - x)
15%
Total
430
4000
--
Calculate x from the grid:
Since both Interest paid columns add up to the total interest earned of 430, we set up an equation 0.1x + 0.15(4000 - x) = 430 0.1x + 600 - 0.15x = 430 600 - 0.05x = 430
Subtract 600 from each side:
600 - 600 - 0.05x = 430 - 600
Cancelling the 600 on the left side, we get:
-0.05x = -170
Divide each side by -0.05
-0.05x
-0.05
=
-170
-0.05
Cancelling the -0.05 on the left side, we get:
x = 3400 ← Fund 1 Investment This means we should 4000 - 3400 = 600 into Fund 2
Final Answer
3400 into Fund 1 600 into Fund 2
What is the Answer?
3400 into Fund 1 600 into Fund 2
How does the Split Fund Interest Calculator work?
Free Split Fund Interest Calculator - Given an initial principal amount, interest rate on Fund 1, interest rate on Fund 2, and a total interest paid, calculates the amount invested in each fund. This calculator has 4 inputs.
What 3 formulas are used for the Split Fund Interest Calculator?
What 3 concepts are covered in the Split Fund Interest Calculator?
interest
payment from a borrower or deposit-taking financial institution to a lender or depositor of an amount above repayment of the principal sum, at a particular rate
principal
The amount borrowed on a loan, before interest is charged
split fund interest
Example calculations for the Split Fund Interest Calculator