POWERNOMICS ENTERPRISES
DELMARVA NOTE PAYABLE - IMPUTED INTEREST COMPUTATION
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Date of note - May 1, 2000
Effective due date - December 31, 2000
Stated interest rate in the agreement - none
Imputed interest rate (based on Kemet line of credit) - 10%
Balance of note due on December 31, 2000 $ 855,000
Rate of interest for discount 10.0%
Number of months of the obligation 8
Interest rate per month for the 8 months 0.8333%
Amount of the discount / reduction in Hurlock purchase price $ 53,437
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Principal amount of the note after the discount is applied $ 801,563
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Amount of interest to record each month for 8 months $ 6,680
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ACCOUNTING - AFTER THE DISCOUNT IS APPLIED:
Principal amount of the note as of May 1, 2000 $ 801,563
Interest charge each month (at 0.8333%):
May $ 6,680
June $ 6,680
July $ 6,680
August $ 6,680
September $ 6,680
October $ 6,680
November $ 6,680
December $ 6,679
Total accrued interest over the life of the note $ 53,437
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Balance due to DelMarva on December 31, 2000 $ 855,000
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