Merry (pridian) wrote in thequestionclub,
Merry
pridian
thequestionclub

Where did they go George, where did they go?

Okay, I'm reading my accounting book to prepare for a test tonight. I'm reading about computing interest for notes receivable. Why are they telling me that the time factor is the number of days divided by 360?

What happened to the other 5 days in the year? Is this a typo or can someone explain to me why (approximately) 5 days are omitted?

Edit: I found out in a footnote why my book said that. It's to allow students to compute "easier". Financial instruments use 365 in the real world.
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