Split Fund Interest with Principal of 6000 and Fund 1 = 8% and Fund 2 = 13% and Interest Paid = 710
An investment of 6000 was made one year ago. Part of the investment was placed into an account paying s interest at 8% The remainder of the investment was placed into an account paying s interest at 13% After one year, you received a total of 710 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 6000 - x
Calculate Interest Credit for Fund 1
Since Fund 1 credits interest using the simple interest method, we have 0.08x
Calculate Interest Credit for Fund 2
Since Fund 2 credits interest using the simple interest method, we have 0.13(6000 - x)
Set up a grid with fund details:
Interest Paid
Principal
Interest
Rate
Fund 1
0.08x
x
8%
Fund 2
0.13(6000 - x)
(6000 - x)
13%
Total
710
6000
--
Calculate x from the grid:
Since both Interest paid columns add up to the total interest earned of 710, we set up an equation 0.08x + 0.13(6000 - x) = 710 0.08x + 780 - 0.13x = 710 780 - 0.05x = 710
Subtract 780 from each side:
780 - 780 - 0.05x = 710 - 780
Cancelling the 780 on the left side, we get:
-0.05x = -70
Divide each side by -0.05
-0.05x
-0.05
=
-70
-0.05
Cancelling the -0.05 on the left side, we get:
x = 1400 ← Fund 1 Investment This means we should 6000 - 1400 = 4600 into Fund 2
Final Answer
1400 into Fund 1 4600 into Fund 2
What is the Answer?
1400 into Fund 1 4600 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?
Fund 1 investment is x Fund 2 investment is T - x Interest paid = Interest Rate * Investment
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
